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India’s Industrial Growth Falls 0.5% in November
Why is it in the news ?
- As per data released by the Central Statistics Office (CSO), Industrial output growth dropped to a 17-month low of 0.5% in November 2018.
- Growth fell due to contraction in the manufacturing sector, particularly consumer and capital goods.
- Factory output, as measured in terms of the Index of Industrial Production (IIP), had grown by 8.5% in November 2017.
More in the news
- The previous low was in June 2017, when IIP growth contracted by 0.3%.
- The growth for October 2018 was revised upwards to 8.4% from 8.1%.
- The manufacturing sector, which constitutes 77.63% of the index, recorded a contraction of 0.4% in November, against a growth of 10.4% a year ago.
Causes:
- Contraction in the consumer and capital goods.
- Adverse base and the post festive winding down of momentum along with fewer working days.
- Tighter domestic financing conditions may also have played a part.
Way Ahead:
- Incrementally improving liquidity.
- Normalisation post festive related disruptions.
- Also the election related spending could get growth supportive enabling higher prints versus today’s IIP number.
Source
Indian Express.