India?s manufacturing sector continues to maintain the growth momentum during the?April-June quarter, according to?the CII-Ascon survey.
CII vice-president & CII Association?s Council chairman B Muthuraman said, ?The industry can do even better provided a more conducive environment for the industry is created.?
The CII Ascon survey showed 30 sectors (27.3%) have registered growth rate of more than 20% in April- June 2010 out of 110 sectors covered, compared to 10 sectors (9%) in the year-ago period. The number of sectors registering high growth rate has also increased from 18 (16.4 %) a year ago to 31 sectors (28.2%) in April-June 2010.
The share of the sectors registering negative growth rate has significantly declined to 15.5% (17 sectors) in the first quarter of the current fiscal from 41% (45 sectors) in the corresponding period of the previous year. The share of the moderate growth sector has also declined to 29% from 33.6% during the same period.
According to the survey, the sectors that have recorded excellent growth are air conditioners (50%), refrigerators (32%), vehicle industry (33.2%), passenger cars (32.5%), natural gas (43.5%),?ball and?roller bearings (30%), machine tools (16%).
Energy meters (16.06%), forging (15.0%), nylon filament yarn (10.2%), fluid power (15%), electric fans (16.0%), induction furnace (10.0%) are the sectors in the high growth category while sectors like asbestos cement (6.4%), caustic soda (2.06%), rubber goods (5.0%), sponge iron (1.64%) are in the moderate growth category. Polyester staple fibre (-0.65%), tea (-4.5%), groundnut oil (-28.4%), cigarette?and tobacco (-2.0%) reported negative growth.
The survey also tracked export performance of manufacturing industries. Out of 23 sectors reporting exports, 11 were in the excellent growth category, four have shown high growth, two were in the moderate growth category while five reported negative growth.
It highlights some of the general and sector-specific issues faced by the industry. Rise in the cost of raw material, infrastructure bottlenecks, environmental regulations and procedures, threat of Chinese imports, weak global demand, lack of technical skills and R&D activities, inadequate credit supply and non-uniformity of VAT structure are some of the key issues faced by the industry.
According to Chandrajit Banerjee, director general of CII, ?Actions such as faster implementation of ongoing and already announced projects, improving regulatory environment, early implementation of the proposal to create National Manufacturing Investment Zones (NMIZ?s), ensuring timely availability of credit and directing banks to provide easier and cheaper credit especially for SMEs are vital to higher manufacturing growth.?