Economic slowdown: Industrial output falls, more pain in the offing

By: |
Published: November 16, 2019 3:43:35 AM

Of the 23 categories within manufacturing, only six registered growth in September and the rest contracted. Output of capital goods, an indicator of investment activity, contracted to 20.7% year-on-year in September, the eleventh month in a row barring December last year.

Economic slowdown, Industrial output, Industrial output falls,  index of industrial production, IIP, GDP, GDP growth, Reserve Bank of India, rbi, economy of india, economy slowdown, economy newsProduction of primary goods shrank 5.1% while that of intermediate goods reported an uptick of 7%. The contraction was most marked for segments dependent on bank funding such as capital goods and durables.

With a 4.3% contraction in September, the growth in the index of industrial production (IIP) was the worst in the last eight years. The decline in September was steeper than the 1.4% contraction reported in August, after 27 months of expansion. Even core sector output contracted to 5.2% in September, posting its worst performance in 14 years, suggesting that the economy may have slumped further in the second quarter of the current financial year.

Within the IIP, growth rates of manufacturing, electricity, primary goods, and infra & construction recorded their worst performance in the current (2011-12) series. Mining output shrank 8.5% in September while electricity generation contracted 2.6% in the month.

Economic slowdown, Industrial output, Industrial output falls,  index of industrial production, IIP, GDP, GDP growth, Reserve Bank of India, rbi, economy of india, economy slowdown, economy news

Production of primary goods shrank 5.1% while that of intermediate goods reported an uptick of 7%. The contraction was most marked for segments dependent on bank funding such as capital goods and durables.

Of the 23 categories within manufacturing, only six registered growth in September and the rest contracted. Output of capital goods, an indicator of investment activity, contracted to 20.7% year-on-year in September, the eleventh month in a row barring December last year.

The second quarter GDP growth—figure is to be released on November 29—may be lower than the six-year low of 5% in the June quarter. Reserve Bank of India has lowered its FY20 annual growth forecast to 6.1% from 6.8% estimated earlier. Even Moody’s had slashed India’s economic growth forecast for 2019-20 to 5.8% from an earlier estimate of 6.2% and has downgraded India’s outlook to negative from stable.

Economic slowdown, Industrial output, Industrial output falls,  index of industrial production, IIP, GDP, GDP growth, Reserve Bank of India, rbi, economy of india, economy slowdown, economy news

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Next Stories
1IBC process gets back on track after SC nixes NCLAT ruling in Essar Steel
2JNU hostels cost 1% of what Delhi University ones cost
3SC allows CJI to come under RTI: Judiciary takes a step towards transparency