Weak performance of manufacturing, mining sectors pulls down growth
The Index of Industrial Production (IIP) contracted 1.8 per cent for the first time in three months in October, according to the data released here by the Central Statistics Office here on Thursday.
The contraction is due to weak performance of the manufacturing and mining sectors.
The manufacturing sector, which constitutes over 75 per cent of the index, declined by 2 per cent during the month under reference as against a growth of 9.9 per cent in the year ago month.
The mining sector also saw a contraction of 3.5 per cent. In October 2012, mining output had dipped 0.2 per cent.
Cumulative industrial output growth between April and October stands nil as against a growth of 1.2 per cent in the corresponding period of 2012-13.
“This indicates industrial stagnation,” said Care Ratings Chief Economist Madan Sabnavis.
There was some positive increase in growth in capital goods, but it was in the electrical segment, where there was a negative base effect.
Ten of the 22 manufacturing industries registered negative growth during the month. Output of ‘Furniture’ contracted almost 30 per cent; ‘office, accounting and computing machinery’ shrank 27.2 per cent; and ‘radio, TV and communication equipment and apparatus’ production fell 23 per cent. Production of ‘electrical machinery and apparatus’ was up 34.2 per cent. Output of ‘other transport equipment’ grew 14.7 per cent.