The index, however, shows a marginal improvement in August by posting a 2.4 per cent growth, against 1.7 per cent in July. But the growth rate is much lower than the 5.2 per cent recorded in August 1997.

The improvement in August has been partly on account of better performances from the manufacturing and electricity sectors, which grew marginally by 2 per cent and 7.5 per cent respectively.

For July, their growth stood at 1.2 per cent and 5.1 per cent respectively. The manufacturing sector, on the other hand, has shown a substantial decline to 0.6 per cent from the previous month's 2.9 per cent.

On a cumulative basis, however, the manufacturing sector's growth rate has fallen to 3.2 per cent for April-August, versus 5.4 per centrecorded during the same period last year.

The electricity sector has registered a growth of 8.8 per cent in the first five months, compared with a 6.8 per cent attained in the same period the previous year.

Seen at a use-based classification level, a major decline came about in capital goods, consumer goods, and consumer non-durables, which saw growth at (-) 1.6 per cent, (-) 1.0 per cent and (-) 1.5 per cent respectively for August. The growth in these sectors in the same month of the previous year stood at 8.6 per cent, 4.1 per cent and 4.3 per cent respectively.

On the other hand, segments like intermediate goods, consumer durables and basic goods have recorded a growth of 5.2 per cent, 0.3 per cent and 3.9 per cent respectively for August. This compares with 6.5 per cent, 3.7 per cent and 4.0 per cent respectively for the same month in the previous year.

For the cumulative period April-August, the capital goods and consumer goods segments recorded 4.8 per cent and 1.7 per cent growth respectivelyover that of the previous year, when it stood at 7.8 per cent and 0.8 per cent respectively.

Other segments like the basic goods, intermediate goods and consumer durables have registered a growth of 3.4 per cent, 4.9 per cent and 0.6 per cent respectively on a cumulative basis for April-August.

Meanwhile, the cumulative growth for consumer non-durables has registered a growth of 1.9 per cent for the latest period over that of the previous year's, when it stood at (-) 0.3 per cent.

The cumulative growth in industrial production has been plummeting consistently during the current fiscal, from 5.4 per cent in April-June to 4 per cent during April-July and now to 3.5 per cent at the end of the first five months of the current fiscal.

Investment slowdown looms large:

Industrial growth (over the corresponding period of last year) slowed down in April-August to 3.5 per cent from 4 per cent in April-July. The growth of manufacturing declined to 3.2 per cent from 3.7 per cent. Likewise, electricitygeneration was up 8.8 per cent, against 9 per cent in the first four months of the fiscal. Mining output growth was unchanged at 0.5 per cent.

The production of capital goods declined in August, bringing down their output growth to 4.8 per cent for the first five months, from 10.5 per cent for April-July. This raises the spectre of an investment slowdown. Basic goods output slipped in August, but cumulative growth for the first five months at 3.4 per cent was higher than 2.6 per cent of April-July. Consumer durables' output improved in August, but this still left cumulative April-August growth below that of April-July. Consumer non-durables output declined in August.

If Assocham's criticism of industrial-production data is taken at face value, the picture provided by the latest provisional data for August might turn out to be even worse when the data is revised by the Central Statistical Organisation.