SME Times is powered by   
Search News
Just in:   • Sensex down 60 points, IT & Media scrips fall  • Lack of formal financing a challenge for MSMEs: NeoGrowth founder  • PSBs post Rs 3,221 cr profits in H1: Mos Finance  • CGST falls short of budget estimate by 40pc in April-NovCGST falls short of budget estimate by 40pc in April-Nov  • More NBFCs to look for offshore financing in 2020: Fitch Ratings 
Last updated: 05 Nov, 2019  

Manufacturing.9..Thmb.jpg Industrial slowdown

Manufacturing.9..Thmb.jpg
   Top Stories
» MSME sector's share in manufacturing 36.5 pc: Gadkari
» Govt may launch new e-commerce policy in FY20
» 'EXIM Bank to disburse $6-7 bn in project export finance'
» '5.70 lakh micro enterprises assisted under PMEGP'
» DPIIT to set up panels to sort out startups
Bikky Khosla | 05 Nov, 2019

The Indian manufacturing sector grew at its slowest pace in two years in October. The IHS Markit India PMI index - based on a survey of 400 producers - fell from 51.4 in September to a two-year low of 50.6 in October. Both factory orders and production rose at their weakest rates in two years. The employment scenario was dull as well, with job creation falling to a six-month low. Also, companies were reluctant to hold excess stock and lowered input buying in response.

The above figures deserve urgent attention. There is little doubt that weakening demand has adverse effect on the manufacturing sector in several ways, affecting its rate of production and employment. Adding to this woe, input costs declined for the first time in over four years and this is another sign of subdued growth conditions. It is also worth mentioning that in October business confidence slipped to its lowest level in over two-and-a-half years. These trends are not at all encouraging.

The latest manufacturing sector data came on the heels of release of the core sector output data for September. The Index of Eight Core Industries contracted over 5 percent against a marginal growth of 0.1 percent registered in the previous month. Barring fertilisers, all the other seven sectors contracted in September, and according to experts, such a low growth has not been witnessed so far in either 2011-12 base or the 2004-05 base series. This indicates the severity of the ongoing industrial slowdown.

While the Centre has been taking steps to arrest the slowdown and the RBI last month slashed its policy rates for the fifth time this year, success still seems elusive. There is little doubt that credit supply to the economy is still very poor with the NBFC sector witnessing a problem with its own funding. Additionally, the cost of credit, too, remains a concern with weak transmission of monetary policy. These challenges must be addressed to arrest the ongoing industrial slowdown.

I invite your opinions.

 
Print the Page
Add to Favorite
 
Share this on :
 

Please comment on this story:
 
Subject :
Message:
(Maximum 1500 characters)  Characters left 1500
Your name:
 

 
  Customs Exchange Rates
Currency Import Export
US Dollar
66.20
64.50
UK Pound
87.50
84.65
Euro
78.25
75.65
Japanese Yen 58.85 56.85
As on 10 Dec, 2019
  Daily Poll
Ease of doing business improved in last one year
 Yes
 No
 Can't say
  Commented Stories
» MRF to set up a new plant in Gujarat(2)
» India software market grew 12.4% in H1 2019: IDC(1)
» Starting an import export business: Basic guide for beginners(1)
» "Govt's mantra Sabka Saath, Sabka Vikas, Sabka Vishwas"(1)
» Forex reserves rise by $2.48 bn to over $451 bn(1)
 
 
About Us  |   Advertise with Us  
  Useful Links  |   Terms and Conditions  |   Disclaimer  |   Contact Us  
Follow Us : Facebook Twitter