New Delhi: Terming the contraction in June industrial output as disappointing, Finance Minister P Chidambaram today said there is a need to promote critical sectors to boost growth.
"The Quick Estimates of IIP for the month of June are disappointing. It is important to focus on the critical sectors, remove bottlenecks and give a fillip to production," Chidambaram said in a statement.
Industrial production has declined 1.8 percent in June from a 9.5 percent growth in the same period a year ago period mainly due to poor show by manufacturing and capital goods sectors, "The production will revive if there are new investments in the demand creating industries," Chidambaram said.
As per the official data, industrial output in the April- June quarter too contracted by 0.1 per cent this fiscal, against a growth of 6.9 per cent in the corresponding period a year ago. Earlier this week, Chidambaram had stressed on removing the supply side constraints and boost manufacturing and exports.
"We intend to find practical solutions to the problems that impede higher production or output in the coal, mining, petroleum, power, road transport, railway and port sectors," he had said. The manufacturing sector, which constitutes over 75 per cent of the index, witnessed a slump in output by a dismal 3.2 percent in June against a growth of 11.1 percent in the same month a year ago.
The performance of the manufacturing sector was also dismal in April-June quarter as the output declined by 0.7 percent against a growth of 7.7 percent in the three-month period a year ago. The capital goods production also declined by massive 27.9 percent in June against a growth rate of 38.7 percent a year ago.