India's November industrial output (IIP) falls, may prompt RBI rate cut: govt

Jan 11 2013, 13:03 IST
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India's Nov industrial output contracts 0.1 pct year on year: govt. (Reuters) India's Nov industrial output contracts 0.1 pct year on year: govt. (Reuters)
SummaryDashing hopes of a rebound, the industrial output contracted to a four-month low.

Dashing hopes of a rebound, the industrial output contracted to a four-month low of 0.1 per cent in November due to poor performance of manufacturing and mining sectors and decline in production of capital goods.

The industrial output, as measured by the Index of Industrial Production (IIP) dipped from a robust 8.3 per cent in October. The decline may prompt the Reserve Bank of India (RBI) to consider rate cut in its quarterly review on January 29 to boost growth.

The industrial output had grown by 6 per cent in November, 2011. Meanwhile, in July, 2012 it showed a contraction of 0.1 per cent.

Factory output growth was 1 per cent in April-November period this fiscal, down from 3.8 per cent in the same period in 2011-12, according to official data released here today.

Meanwhile, the growth in the industrial production during October last year was revised upward to 8.3 per cent, from earlier provisional estimates of 8.2 per cent released last month -- highest in previous 16 month.

The manufacturing sector, which constitutes over 75 per cent of the index, grew by meagre 0.3 per cent in November in 2012, as against a 6.6 per cent in 2011.

The output of the key sector remained low at one per cent in April-November last year as against 4.2 per cent growth in the same period in 2011.

The mining output in November contracted by 5.5 per cent compared to a decline in production by 3.5 per cent in same month in 2011. The sector's production in April-November also declined by 1.5 per cent, against a contraction of 2.4 per cent in the year-ago period.

Capital goods output declined by 7.7 per cent in November, as against a contraction of 4.7 per cent in same month in 2011.

The output of capital goods also contracted in the April-November period by 11.1 per cent, as against a dip in production by 0.1 per cent in the 2011-12 period.

Power generation grew by 2.4 per cent in November, as against 14.6 per cent in same month in 2011. The electricity generation in the April-November period this fiscal is 4.4 per cent, as against 9.5 per cent in a year-ago period.

Consumer goods output growth was 1 per cent in November as against 12.8 per cent. In the April-November period of this fiscal, the growth in consumer goods was 3.8 per cent as compared to 5 per cent in the same period of 2011-12.

The growth

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