India's industrial production contracted 1.6 percent in May from a year earlier as against an expectation of 1.5 percent growth and retail inflation rate for June rose to 9.87 percent, giving rise to a complex situation for the Reserve Bank of India and government to deal with.
Manufacturing sector, which constitutes about 76 percent of industrial production, shrank 2.0 percent from a year earlier, the federal statistics office said. Capital goods production, a barometer for investments in the economy, contracted an annual 2.7 percent in May from a year earlier.
Will the RBI take into account the IIP numbers in their next policy review on 30 June? How much will inflation and low factory output impact its policy?
Sourav Majumdar, Editor-in-chief of Entrepreneur magazine discussed with Firstpost the relevance of IIP numbers and how RBI will see it.
Watch the video to know more.