Terming the decline in industrial output in September as “very disappointing”, Planning Commission Deputy Chairman Montek Singh Ahluwalia, on Monday, said the impact of recent reform initiatives will manifest in the data for the second half of the fiscal.

“The Index of Industrial Production (IIP) for September is obviously very disappointing...the September data does not reflect the impact of any recent initiatives. These initiatives will also take some time to have an impact”, he said.

Dr Ahluwalia was commenting on the IIP data which showed that industrial output in September contracted by 0.4 per cent due to poor performance of the manufacturing sector and decline in consumer as well as capital goods output.

“We have to look to the second half of the current year to see if the economy is actually going to do better” he said.

IIP data showed a very negative growth in capital goods reflecting investment downturn, he said, adding “investment is not something which reverses itself month to month. If investment plans have slowed down, it takes long time to pick up. You should not expect very quick reversal on monthly basis”.

The economy, Dr Ahluwalia said, has already hit the bottom but it would take some time to know whether the turn around has begun or not.

The economic growth rate slipped to a nine-year low of 6.5 per cent in 2011-12. The Reserve Bank of India had projected 5.8 per cent growth rate for 2012—13.

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