The aggregate IIP as per Quick Estimates from CSO declined 1.6 per cent during May 2013, against 1.8 per cent increase in the preceding month, 3.4 per cent two months ago, and 2.5 per cent during this month last year. Reflecting the corrosion, as many as six out of last 12 months have ended with y-o-y decline in factory output. Heavyweight manufacturing declined 2 per cent over an already unimpressive 2.6 per cent rise a year ago. Investment and consumption have been battered noticeably: capital goods production declined 2.7 per cent and consumer goods a steeper 4 per cent due to 10 per cent weakening in consumer durables.

Half of 22 industries at two-digit NIC levels showed decline in May. Industries showing slumped output included sugar (including sugar cubes) [(-) 37.8 per cent], polyester chips [(-) 26.6 per cent], copper and copper products [(-) 67.3 per cent], boilers [(-) 32.9 per cent], earthmoving machinery [(-) 30.3 per cent], sugar machinery [(-) 70.2 per cent], plastic machinery including moulding machinery [(-) 48.0 per cent], and telephone instruments including mobile phones and accessories [(-) 28.6 per cent].

INDEX OF INDUSTRIAL PRODUCTION
(Y-O-Y % INCREASE)
 
May
April-May
 
2012
2013
2012-13
2013-14
Mining
-0.7
-5.7
-1.7
-4.5
Manufacturing
2.6
-2
0.4
0.1
Electricity
5.9
6.2
5.2
5.3
Overall IIP
2.5
-1.6
0.6
0.1
Use-based classification
Basic goods
4.4
-0.4
3.2
0.7
Capital goods
-8.6
-2.7
-15.2
-1.5
Intermediate goods
3.4
1.5
0.8
2.1
Consumer goods
4.4
-4
4
-1
Consumer durables
9.7
-10.4
7.5
-9.6
Consumer non-durables
-0.1
1.7
1.1
6.7

PVC pipes and tubes (+31.0 per cent), tractors (+31.3 per cent), cable and rubber insulated (+56.6 per cent), and gems and jewellery (+31.3 per cent) were among the few industries recording noteworthy growth rates.

Going by use-based classification, capital goods index declined for the second month in May, dashing the hopes of the sector returning to some ordinariness because of 9 per cent average growth during February and March. Nevertheless, the average decline during April-May was much smaller than that in the corresponding months a year ago.

Consumer durables, somewhat akin to capital gods, declined 9.6 per cent during the period, against 7.5 per cent rise a year ago. Basic goods IIP almost stagnated at year-ago level, whereas intermediate goods index and consumer non-durables fared relatively better during the first two months of the ongoing fiscal.

Prognosis for June
Electricity generation has declined 1.5 per cent during June, according to tentative data from CEA. This along with decline in export and import of merchandise points to a likely subdued industry feat for the month. Broader IIP had declined 2 per cent in June 2012, but the performance had come after 9.5 per cent robust growth in this month in 2011.


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