July IIP brings in cheer with 2.6% growth

New Delhi: After contracting for two straight months, industrial production entered the positive zone in July, recording a growth of 2.6 percent on account of improved performance of manufacturing and power sectors.

Factory output measured in terms of the Index of Industrial Production (IIP) had contracted 0.1 percent in July last year, as per the data released by Central Statistical Organisation today. Meanwhile, IIP for June was revised upwards to a decline of 1.78 percent from a provisional 2.2 percent dip in production. It contracted by 2.8 percent in May this year.

[caption id=“attachment_1104943” align=“alignleft” width=“380”]  IIP numbers improved after falling for two months. Reuters. [/caption]

During April-July this year, factory output contraction remained flat at 0.2 per cent. The manufacturing sector, which constitutes over 75 percent of the index, grew by 3 percent in July compared to zero growth in the month a year earlier. During April-July, the sector saw a decline of 0.2 percent compared with a contraction of 0.6 percent in the period last year.

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Power generation increased by 5.2 percent in July as against a growth of 2.8 percent in same month in 2012. Power generation in the April-July grew 3.9 percent compared with an expansion of 5.5 percent in same period last year.

Output of capital goods, a barometer of demand, grew by 15.6 percent in July compared with a decline of 5.8 percent in the same month a year earlier. During April-July, capital goods production grew 1.8 percent compared with a production drop of 16.8 percent in same period last year.

Meanwhile, the mining output declined 2.3 percent in July, compared with a dip of 3.5 percent. In April-July, the sector declined 4 percent compared with a contraction of 2 percent in the corresponding period.

Among the 22 industry groups in the manufacturing sector, 11 recorded positive growth in July.

Consumer goods output contracted 0.9 per cent in July, compared with expansion of 0.7 percent in the same month last year. Production of these goods declined 2 per cent in April-July compared with growth of 3.1 percent in the same period of 2012.

The decline in output of consumer durables stood at 9.3 percent in July, from a growth of 0.8 percent previously. The segment saw a 12 percent decline in output in April-July compared with growth of 6.1 percent.

Consumer non-durables output expanded 6.8 percent in July against a contraction of 0.6 percent a year earlier. The segment grew 6.8 percent in April-July compared with growth of 0.6 percent.

Growth in intermediate goods production was at 2.4 percent in July as against 0.1 percent a year ago. For April-July, the segment’s expansion was 1.8 percent compared with 0.6 percent in the same period a year ago.

Basic goods output grew by 1.7 percent in July from a growth of one percent in July 2012. Production of these goods grew by 0.2 percent in April-July compared with growth of 2.7 percent a year earlier.

PTI