IIP: Industrial Output Growth At Four-Month Low In July
The Index of Industrial Production rose 2.4% in July compared with 12.7% in June.
India’s factory output expanded at the slowest pace since March this year.
The Index of Industrial Production rose 2.4% in July compared with 12.7% in June, the data published by the Ministry of Statistics and Programme Implementation on Monday showed.
Twenty-eight economists polled by Bloomberg had forecast July IIP growth at 4.2%.
Month-on-month, the index declined 2.75%.
The IIP figures for June and April underwent their first and final revisions this month.
While base effects played a major role, industrial production also contracted on a sequential basis in July, Rahul Bajoria, chief economist at Barclays, said. As global growth weakens, the recovery in domestic demand will remain the key driver of industrial output, he said.
Rajani Sinha, chief economist at CareEdge, said slow growth in the manufacturing sector and poor performance of consumer goods is specifically concerning. Momentum in infrastructure and capital goods-related sectors would continue amid upbeat capex by the centre and policy thrust on infrastructure development.
The commencement of the festive season should aid in some revival of consumption spending, Sinha said. But the downside risks emanating from elevated domestic inflation and global growth slowdown would continue to persist, she said.
Mining output declined 3.3% year-on-year in July, against 7.8% in June. Month-on-month, in July, mining output declined 11.1%,
Manufacturing output rose 3.2%, compared with 13% in June. Month-on-month, manufacturing output fell 1.2%
Electricity generation rose 2.3% annually, against 16.4% in June. Month-on-month, electricity generation contracted 4.1%.
Industrial output, as classified by the end-use of goods, showed:
Primary goods output rose 2.5% in July year-on-year, against 13.8% in June. Month-on-month, it contracted by 5.4%.
Capital goods output rose 5.8%, against 29% in June. It declined by 6.7% sequentially.
Intermediate goods output rose 3.6%, compared with 10.6% in June. It increased by 1.6% month-on-month.
Infrastructure and construction goods output rose 3.9%, as opposed to 9.3% a month ago. Month-on-month it registered a 0.4% decline.
Consumer durables output rose 2.4%, against 25.1% in June. On a sequential basis, output fell 3%.
Consumer non-durables output declined 2%, as opposed to a 3% increase in June. Month-on-month it rose by 2.1% in July.