Press Release

Industrial growth crosses 10% in Oct

Industrial growth crosses 10% in Oct  The Hindu Business Line: December 11,2009 New Delhi: Indian industry registered a growth rate of 10.3 per cent in October, providing further evidence of a sustained recovery under way since the second quarter of the current fiscal.

The 10.3 per cent year-on-year increase in the official Index of Industrial Production (IIP) comes on a lower base; the same month in 2008 saw a growthof just 0.1 per cent. But even after the base effect is factored in, the pick-up trend is perceptible since around June, following almost three successive quarters of virtual stagnation in the wake of the global economic crisis.

The cumulative industrial growth for April-October, at 7.1 per cent, is higher than the 4.3 per cent for the corresponding seven months of 2008-09.With the base effect likely to be pronounced in the coming months (because
of the low growth rates during the same period of 2008-09), the current fiscal may well end with an overall eight per cent-plus figure.

Among the major constituents of the IIP, the index for ‘manufacturing' recorded a growth of 11.1 per cent in October (against minus 0.6 per cent in the same month of last year), with the rates correspondingly being 8.2 per cent (3.2 per cent) for ‘mining' and 4.7 per cent (4.4 per cent) for ‘electricity'.

During the seven months of the current fiscal, ‘manufacturing' grew 7.1 per cent year-on-year (compared to 4.5 per cent in April-October 2008-09), ‘mining' 7.9 per cent (3.8 per cent) and ‘electricity' 6.5 per cent (2.8 per cent).

Capital goods up

The use-based classification of the IIP presents an equally sanguine picture. Production of capital goods – which is a proxy for investment demand in the economy – was up 12.2 per cent in October (against 4.2 per cent in the same month last year) and 6.3 per cent for the seven months of the current fiscal (against 9.7 per cent during April-October 2008-09).

Likewise, the growth rates in October amounted to 14.3 per cent for intermediate goods (minus 4.4 per cent in October 2008), 5 per cent (3.2 per cent) for basic goods, 21 per cent (minus 1.6 per cent) for consumer durables and 8.1 per cent (minus 0.6 per cent) for consumer non-durables.


Consumer goods, in particular, have clearly benefited from the base effect.

For the April-October period, production of intermediate goods rose by 10.2 per cent (against a decline of 0.3 per cent in the corresponding seven months of 2008-09), while these stood at 6.4 per cent (3.8 per cent) for basic goods, 19.4 per cent (5.8 per cent) for consumer durables and 0.8 per cent (6.6 per cent) for consumer non-durables.

Consulate General of India

 

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