Factory output remained in the positive zone for the third consecutive month in January 2015, though the 2.6 per cent rate indicated a slowdown from 3.9 per cent in November and 3.2 per cent in December. The slowing pace reflected fast declining power generation — the y-o-y growth rate fell from 10 per cent in November to 4.8 per cent the following month and 2.7 per cent in January, and mining index that went deeper into decline. However, the long-time subdued manufacturing maintained 3+ per cent growth rate. By the way, growth rates in broader IIP and manufacturing for December stand revised to 3.2 per cent and 3.6 per cent in first revision, against1.7 per cent and 2.1 per cent provisionally assessed earlier. This followed a sharp upward revision in the rates of basic metals (13.7 per cent, against 3.9 per cent), rubber and plastic products (15.3 per cent, against 4 per cent) and electrical machinery (28.1 per cent, against 13.4 per cent). Capital goods index increased 12.8 per cent, twice the average rate during November-December 2014. Consumer durables kept eroding. Consumer non-durables declined 0.1 per cent and intermediate goods 0.8 per cent. Basic goods index slowed for the third month. Among the 22 major industries, eight showed decline, while 14 recorded positive growth.

Taking the cumulative data for April-January 2014-15, a steady though subdued improvement in industrial production is evident. Total factory production index showed 2.5 per cent (0.1 per cent) increase: manufacturing expanded 1.7 per cent (decline of 0.3 per cent), mining 1.3 per cent (decline of 1.1 per cent) notwithstanding declines in December-January, and electricity 9.3 per cent (5.7 per cent). In mining, coal production increased 8.1 per cent (1.5 per cent);crude oil and natural gas continued to sink.

In manufacturing, five out of 22 major industries (at two-digit NIC levels) declined y-o-y during the first 10 months of the ongoing fiscal. The steepest decline of 55 per cent was recorded in radio, TV and communication equipment. Electrical machinery recorded 20 per cent increase, machinery and equipment 3 per cent, basic metals 13 per cent and other non-metallic mineral products 4 per cent. Transport equipment increased 8 per cent and passenger cars 1 per cent. Refinery production increased 0.7 per cent during April-January 2014-15.

In use-based classification, basic goods index increased 7.4 per cent during the first 10 months of ongoing fiscal, against 1.6 per cent during the corresponding period of 2013-14. Capital goods that cater to project investment increased 5.7 per cent (decline of 0.8 per cent). Among the other material inputs in project execution, cement production increased 7.1 per cent, twice the rate in the similar period in 2013-14, whereas alloy-non-alloy steel production retarded from 11.4 per cent to 1.6 per cent. Intermediate goods increased 1.5 per cent (3.2 per cent). Causing concern on possible weakening consumer demand, consumer non-durables slowed to 1.9 per cent (5.7 per cent), whereas consumer durables, which include scooters, cars, gems and jewellery etc., sank deeper in red.

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