SME Times News Bureau | 13 Nov, 2013
Industrial output rose at a sluggish two percent during September, due to poor performance of the manufacturing sector, government data showed Tuesday.
Factory output measured in terms of the Index of Industrial Production (IIP) had grown by 0.43 percent in August.
The cumulative growth of the industrial production for April-September period stood at 0.4 percent year-on-year, according data released by the Central Statistics Office (CSO) here.
Manufacturing sector grew at a sluggish 0.6 percent. Mining output increased by 3.3 percent and electricity production rose by 12.9 percent in September.
As per "use-based" classification, basic goods sector posted a growth of 5.4 percent, intermediate goods 4.1 percent, and consumer non-durables 11.3 percent.
However, capital goods continue to be a big drag. Capital goods output slumped by 6.8 percent during the month under review, while consumer durables production fell by 10,8 percent.
"The modest increase in IIP for the month of September is not reason enough for us to conclude that industry has turned the corner and is on a path to recovery," said Chandrajit Banerjee, director general of the Confederation of Indian Industry (CII), commenting on sluggish industrial growth.
In a similar tone, Assocham president Rana Kapoor said, "Pace of industrial activity in September belied market expectations as it rose by a less than anticipated 2 per cent. It is worrisome that the activity in the manufacturing sector has remained subdued for almost 2 years now."
"Positive growth in manufacturing has shown revival. However, we expect the growth in manufacturing to be subdued in the coming months as a result of the current slowdown in domestic demand and lack of investor optimism given the usual uncertainty that builds around elections," Ficci president Naina Lal Kidwai said.
"The performance of consumer goods - particularly that of consumer durables, continues to be a cause for concern as it indicates very poor demand," Mr Banerjee said.
Overall the consumer goods grew by just 0.6 per cent in September this year compared to flat output in the same month last year.