Sharp fall expected in industrial growth for Apr-June quarter: report

New Delhi: A sharp fall is expected in the growth of industrial sectors such as textile machinery, cement and fertiliser in the April-June quarter owing to the rupee’s depreciation, high inflation and fiscal deficit, a study said Sunday.

“The sector-wise analysis on performance of the industry sector clearly indicated that almost all sectors on an average expect decelerating production growth during the first quarter of 2012-13,” said a survey by the Confederation of Indian Industry (CII)-Ascon.

“While there are fewer sectors in the excellent and high category for all segments, most of the sectors’ output growth is concentrated in low category,” it added.

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The survey was conducted across 114 sectors having more than 35,000 companies.

According to it, sectors comprising electronic motors, earthmoving and construction equipment, rubber goods, tyres and crude are expected to register low growth of 0 to 10 percent.

The share has moved up to 52.6 percent of the total in the quarter under review as compared to 42.2 percent in first quarter of 2011.

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Sectors comprising textile machinery, transformer and pumps are estimated to fall in negative territory. The percentage has increased from 5.2 percent in Q1 2011 to 15.7 percent in Q1 2012.

Sectors comprising automobile, energy meters, ball and roller bearings and scooters with high growth will be having 10-20 percent growth.

The share has decreased to 24.5 percent in the quarter under review from 31.8 percent in the like period of the previous financial year.

However 7.2 percent of the sectors including LCD, LED, microwave ovens are expected to register an excellent growth of more than 20 percent.

“Most of the respondents of the Ascon survey revealed that the deceleration was mainly due to monetary tightening measures of the Reserve Bank of India (RBI) to control inflation and the effect of global economic slowdown which had a dampening effect on the demand,” CII director general Chandrajit Banerjee said.

“The situation calls for concerted effort from the government and the RBI to ensure that we have a cohesive economic recovery plan,” he added.