Industrial output growth drops to 4.3% in July

The Index of Industrial Production data shows a significant slowdown in the manufacturing sector, which grew at 4.2% in July 2019 as compared to 7% a year ago.

India’s industrial production growth slowed to 4.3% in July, dragged mainly by manufacturing sector’s poor show, according to a government data released on Thursday.

Factory output, as measured by the Index of Industrial Production (IIP), had expanded 6.5% in July 2018.

The industrial output growth was recorded at 1.2% in June and 4.6% in May this year.

According to the data released by the Ministry of Statistics and Programme Implementation, industrial output grew at 3.3% in April-July period this fiscal, down from 5.4% growth in the same period a year ago.

The IIP data showed a significant slowdown in the manufacturing sector, which grew at 4.2% in July 2019 as compared to 7% a year ago.

Capital goods segment, which is a barometer of investment, saw a contraction of 7.1% in July compared to 2.3% rise a year ago.

Mining growth was 4.9% in July as compared to 3.4% in the same month last fiscal.

The expansion in the power generation sector stood at 4.8% in July, compared to 6.6% a year earlier.

As per use-based classification, the growth rates in July 2019 over July 2018 are 3.5% in primary goods, 13.9% in intermediate goods and 2.1% in infrastructure/construction goods.

Consumer durables and consumer non-durables have recorded growth of (-)2.7% and 8.3%, respectively.

In terms of industries, 13 out of 23 industry groups in the manufacturing sector have shown positive growth during July as compared to the same month a year ago.

The industry group ‘manufacture of food products’ has shown the highest positive growth of 23.4%followed by 17.3% in ‘manufacture of basic metals’ and 15% in ‘manufacture of wearing apparel’.

On the other hand, the industry group ‘manufacture of paper and paper products’ has shown the highest negative growth of (-)15.4% followed by (-)13.3% in ‘manufacture of motor vehicles, trailers and semi-trailers’ and (-)10.9% in ‘printing and reproduction of recorded media’, it added.

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