IIP Shows no Signs of Recovery, Contracts 0.6% in December - The New Indian Express

IIP Shows no Signs of Recovery, Contracts 0.6% in December

Published: 12th February 2014 07:18 PM

Last Updated: 12th February 2014 07:18 PM

Showing no signs of recovery, industrial production growth rate remained negative for the third month in a row, contracting 0.6 per cent in December 2013, mainly due to sluggishness in manufacturing sector.

During December 2012 as well, the factory output, as measured in terms of the Index of Industrial Production (IIP), had contracted by 0.6 per cent.

Meanwhile, contraction in IIP during November 2013 has been revised to 1.3 per cent, from the provisional estimate of 2.1 per cent dip.

The decline in factory output, which began in October with IIP contracting by 1.6 per cent, continued in December, as per the government data released today.

Industrial output for the April-December period of this fiscal, has thus contracted by 0.1 per cent, compared to growth of 0.7 per cent in the same period of 2012-13.

The manufacturing sector, which constitutes over 75 per cent of the index, declined by 1.6 per cent in December, as against a contraction of 0.8 per cent in the year-ago period.

During April-December, the sector's output contracted 0.6 per cent compared to a growth of 0.6 per cent in same period in 2012.

Overall, the consumer goods output declined by 5.3 per cent in December, compared to a contraction of 3.6 per cent in the same month in 2012.

During April-December, 2013-14, the consumer goods output contracted by 3 per cent, compared to 2.7 per cent growth in the corresponding period in 2012-13.

The consumer durables segment contracted by 16.2 per cent in December as against a decline of 8.1 per cent in the same month in 2012.

For the April-December period, the segment declined by 12.9 per cent compared to a growth of 3.7 per cent in same period in 2012.

Overall, 8 out of 22 industry groups in the manufacturing sector have shown negative growth in December.

The growth in consumer non-durables sector was 1.6 per cent in December as against a contraction of 0.5 per cent in the same month in 2012.

During the April-December period, the segment's growth was 5.7 per cent, compared to 1.8 per cent during the nine months of 2012-13 fiscal.

The mining sector, with a weight of about 14 per cent in IIP, grew by 0.4 per cent in December as against a dip of 3.1 per cent in the same month in 2012.

During April-December, the output shrank by 1.8 per cent as it did in the same period last year.

Power generation posted a growth of 7.5 per cent in December last year, compared to 5.2 per cent in the same month of 2012. Expansion in power generation was 5.6 per cent in April-December, as compared to 4.6 per cent a year ago.

Capital goods production, a barometer of demand, showed a decline in output by 3 per cent in December 2013 compared to a contraction of 1.1 per cent in the same month a year ago. The segment declined by 0.5 per cent in April-December as against a sharp contraction of 10.1 per cent in the comparable period.

Intermediate goods segment expanded at a rate of 4.5 per cent in December, compared to a contraction of 0.2 per cent in same month in 2012. During April-December, the segment grew by 3 per cent compared to 1.6 per cent growth in the nine month period in 2012.

The basic goods segment grew by 2.4 per cent in December, compared to 2.2 per cent growth in same month in 2012. During April-December, the segment grew by 1.3 per cent as against 2.6 per cent in the nine month period a year ago.

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