Raising hopes of turnaround, production numbers in April show an upturn at 3.4 per cent, says official data released on Thursday. In the last two months the factory output was contracted, the numbers show it was recovering especially in output of manufacturing, mining and electricity production and capital goods.While the factory output had started declining in October, when index of industrial production (IIP) contracted 1.2 per cent, and the trend continued till December. In April 2013, IIP had shown growth of 1.5 percent.
The latest data is looking to revive thus the new government can now plan to increase job market in manufacturing sector, as it constitutes over 75 per cent of the IIP index,
which increased 2.6 per cent in April as against 1.8 per cent corresponding month last year.
It is now clear that Modi government could improve the sentiment and even the production of capital goods are increase at 15.7 per cent, as against 0.3 per cent for the same month last year. Even power generation was increased 11.9 per cent against 4.2 per cent in the same month of 2013.
However, consumer sentiment continued to remain subdued. Consumer goods output shrunk 5.1 per cent in April against 1.7 per cent growth a year ago. While the production of consumer non-durables also declined by 3.3 per cent, against a growth of 11.3 per cent in April last year.
Commenting on IIP data for April 2014, Confederation of Indian Industry Director General Chandrajit Banerjee said, “The return of industrial growth to the positive terrain is noteworthy and has rekindled the hope of industrial recovery which is critical to lift the economy and mark a return to the path of growth”.
“What is encouraging is that all the three major segments of industry viz. mining, manufacturing and electricity have posted positive growth…. The double digit growth of capital goods could mark a beginning of an upturn in investments backed by an improvement in business sentiments and fast clearances of stalled projects.”
