NEW DELHI: India’s Industrial Production (IIP) grew at 1.3% in the month of January, after hitting a 10-month low in December, according to the data released by the Commerce Ministry on Friday.
In December, the Industrial production showed just a 0.4% year-on-year growth compared to 1.4% growth registered in November 2021. The index is up around 13.7% on a cumulative basis in April-January 2021 compared to April-January 2020.
The mining sector witnessed the highest growth at 2.8% during the January month as compared to a rise of 2.6% in December. Similarly, the manufacturing sector output grew 1.1% as against a degrowth of 0.9% in December 2021. However, the electricity generation growth lagged in January 2022, rising 0.9% versus 2.8% in December 2021.
However, the growth in Industrial Production in January hasn’t amused the analyst much as they find it relatively slower. Dr. Sunil Kumar Sinha, Principal Economist of India Ratings and Research noted that growth momentum was expected due to the spread of omicron variant of Covid-19 pandemic, but inability of the industrial sector to recover on a sustained basis point towards deeper problem like weakness in demand and/or supply side issues.
Also, four consecutive months of negative growth in consumer durables and capital goods is indicating that neither consumption demand nor the investment demand is showing any traction. “The growth recovery in industrial output continues to be an area of worry as once again industrial output growth as captured by the Index of Industrial Production (IIP) came in at 1.3% in January 2022,” said Sinha.
“However, despite the dismal growth numbers the positive side of January 2022 industrial output is that in level terms it has remained higher than the pre-Covid levels.”