India’s industrial output for April signals recovery

June 12th, 2009 - 5:13 pm ICT by IANS  

New Delhi, June 12 (IANS) India’s industrial output grew 1.4 percent in April as against a decline of 0.75 percent in March, in what analysts said can be taken as early signs of recovery.
Data on index of industrial production (IIP) released by the commerce ministry Friday showed that the growth also came after two successive months of decline and was led mainly by a 7.1 percent increase in electricity generation.

The manufacturing output, which has the maximum weight of nearly 80 percent in the general index, continued to register a poor growth, expanding by a mere 0.7 percent in April, against a growth of 6.7 percent in the like month of last year.

The mining index, the other major sub-index, logged a 3.8 percent growth against 6.1 percent in April last year.

Another sign of a broad-based recovery is that 11 out of 17 industry groups have shown growth during April, led by 31.1 percent wood and related products, 12.6 percent for wool, silk and manmade textiles and 10.2 percent for non-metallic mineral products.

Curiously, though, while consumer non-durables output grew 16.9 percent, consumer durables registered a decline of 10.4.

“In coming months, industrial production is likely to continue to show signs of improvement,” said Nikhilesh Bhattacharyya, associate economist with Moody’s, commenting on the industrial production data.

The government’s focus infrastructure projects, recovering business confidence, accommodative monetary policy of the central the recent rebound in commodity prices will help stimulate production, Bhattacharyya added.

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