spot_img
Tuesday, June 28, 2022
No menu items!
More
    spot_img
    HomeBusinessFactory output rises 7.1 per cent in April, is at 8-month high

    Factory output rises 7.1 per cent in April, is at 8-month high

    -

    India’s factory output growth rate accelerated to an eight-month high at 7.1 per cent annually in April on the back of a lower base, according to data released by the National Statistical Office. Sequentially, the index of industrial production (IIP) contracted 9.2 per cent as manufacturing and mining output fell sharply.

    Sequentially, mining output contracted 19.7 per cent and manufacturing output fell 8.8 per cent while electricity generation grew 1.8 per cent.

    According to use-based classification also, the slowdown in activity was visible across the board. All the six sectors including capital goods (-18.7 per cent), consumer durables (-13.4 per cent) and consumer non-durables (-6.5 per cent) contracted sequentially in April.

    Aditi Nayar, chief economist at ICRA Ratings, said the low base of the second wave of Covid-19 bumped up the IIP growth to an 8-month high of 7.1% in April 2022. “The weak showing of capital goods output relative to the pre-Covid level confirms our view that the uptick in capacity utilisation in Q4 FY2022 will not trigger a rapid private sector capacity expansion in light of the uncertainties generated by geo-political developments,” she said.

    Nayar said the daily average generation of GST e-way bills dipped to a four-month low in May, which may be an early indication of the disruption being caused by higher prices on household budgets.

    “Moreover, the YoY growth of non-oil merchandise exports eased in May relative to the previous month. However, most other high frequency indicators recorded an accelerating growth on a declining base in May. Given the sharp YoY expansion displayed by most high frequency indicators in May, we expect the IIP growth to rise further to 17-19% in that month, on the back of a falling base related to the second wave of Covid-19 in India in May 2021,” she said.

    Dear Reader,

    Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
    We, however, have a request.

    As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

    Support quality journalism and subscribe to Business Standard.

    Digital Editor

    Related articles

    LEAVE A REPLY

    Please enter your comment!
    Please enter your name here

    Stay Connected

    0FansLike
    0FollowersFollow
    3,369FollowersFollow
    0SubscribersSubscribe
    spot_img

    Latest posts