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IIP abysmally slips to 1.8% in December
Owing to sluggish growth in manufacturing and capital goods sectors, the country’s index of industrial production (IIP) slipped to an abysmal level of 1.8 per cent in December, even as Finance Minister Pranab Mukherjee expressed hope that it would revive in the coming months.
The data released by the Central Statistical Organisation of the Ministry of Statistics and Programme Implementation on Friday showed that the cumulative IIP for the eight months of the current fiscal (with base year 2004-05) declined to 3.6 per cent from 8.3 per cent in the corresponding period of last fiscal.
Factory output growth, as measured by the Index of Industrial Production (IIP), slipped from 5.94 per cent in November. It grew by 8.1 per cent in December, 2010.
The decline in industrial output, which comes in the backdrop of a likelihood in moderation in economic growth of 6.9 per cent in the current fiscal from 8.4 per cent in the previous fiscal, may prompt the Reserve Bank to reduce interest rates in its mid-quarterly policy review next month.
“IIP is disappointing... I hope, from the next couple of months it will start improving,” Mukherjee said.
Output of the manufacturing sector, which constitutes over 75 per cent of the index, rose at a lower rate of 1.8 per cent in December, compared to a growth of 8.7 per cent in the same month of 2010.
Owing to sluggish growth in manufacturing and capital goods sectors, the country’s index of industrial production (IIP) slipped to an abysmal level of 1.8 per cent in December, even as Finance Minister Pranab Mukherjee expressed hope that it would revive in the coming months.
The data released by the Central Statistical Organisation of the Ministry of Statistics and Programme Implementation on Friday showed that the cumulative IIP for the eight months of the current fiscal (with base year 2004-05) declined to 3.6 per cent from 8.3 per cent in the corresponding period of last fiscal.
Factory output growth, as measured by the Index of Industrial Production (IIP), slipped from 5.94 per cent in November. It grew by 8.1 per cent in December, 2010.
The decline in industrial output, which comes in the backdrop of a likelihood in moderation in economic growth of 6.9 per cent in the current fiscal from 8.4 per cent in the previous fiscal, may prompt the Reserve Bank to reduce interest rates in its mid-quarterly policy review next month.
“IIP is disappointing... I hope, from the next couple of months it will start improving,” Mukherjee said.
Output of the manufacturing sector, which constitutes over 75 per cent of the index, rose at a lower rate of 1.8 per cent in December, compared to a growth of 8.7 per cent in the same month of 2010.
