India’s Industrial Output Growth

NEW DELHI (Reuters) – India’s industrial output growth reached a six-month high of 5.2% year-on-year in November, supported by significant increases in consumer durables and capital goods, according to government data released on Friday.

Economists surveyed by Reuters had anticipated a growth rate of 4.1%.

Sector Performance

• Manufacturing sector: Grew 5.8% in November, representing roughly 17% of India’s GDP.
• Electricity generation: Increased by 4.4%.
• Mining activity: Rose 1.9%.

In October, these sectors recorded growth rates of 4.4%, 2%, and 0.9%, respectively.

Madan Sabnavis, an economist at Bank of Baroda, remarked, “We need to see if this (IIP growth) can be sustained in the coming months, as this will bolster the GDP growth number for the year where manufacturing sector growth has been subdued at 5.3%.”

India’s economic growth is projected to decelerate to a four-year low of 6.4% for the financial year ending March 31, based on estimates released earlier this week.

Detailed Sector Growth

• Consumer durables output (includes household appliances and vehicles): Increased by 13.1% in November, up from revised 5.7% growth a month prior.
• Capital goods output (includes manufacturing plants and machinery): Grew 9% in November, compared to 3.1% in October.

In summary, industrial output increased by 4.1% in the April-November period, down from revised 6.5% growth a year ago.