Industrial activity saw robust growth for the second consecutive month in December, with the Index of Industrial Production growing 7.07%. The rise follows strong growth in the manufacturing, capital goods, and consumer non-durables sectors, according to official data released on Monday.
Retail inflation eased somewhat in January, but remained at about 5%.
The Consumer Price Index quickened by 5.07% in that month, boosted by the persistently high inflation in the food and fuel segments, a separate data release on Monday showed. The relatively strong growth in the IIP comes on top of an even stronger growth of 8.8% in November.
‘Recovery on course’
“I think the broad message is that the recovery is still on course,” Chief Policy Advisor at EY India D.K. Srivastava told The Hindu .
“There is a base effect, especially on capital goods. There is also a small deceleration over last month’s growth rate, but it does not disturb the recovery story, ” he said
Growth in the consumer durables segment continued to be sluggish, however, coming in at 0.86% in December, down from the 3.21% in the previous month.
“India’s growth story continues to march on,” Commerce and Industry Minister Suresh Prabhu tweeted, reacting to the IIP data. “Focus on Make In India [is] showing consistent results. Manufacturing recorded a robust growth of 8.4% in December 2017 over December 2016. Double digit growth of 16.4% in capital goods and consumer non-durables at 16.5% reinforces heightened economic activity.”
Retail inflation remained above 5% in January, following up on the 5.21% growth in CPI seen in December 2017. January, however, marks a break in the six-month streak of accelerating inflation seen since June 2017. Inflation in the food and beverages segment of the CPI eased marginally to 4.58% in January, from 4.85% in the previous month. Inflation in the clothing and footwear segment accelerated to 4.94% from 4.85% over the same period.
