India's industrial output contracts for first time in nearly 2 years
Industrial output fell 0.1% year-on-year in August, contrary to economists’ expectations of 1.2% growth
INDIA’S industrial output contracted for the first time in nearly two years, partly hurt by weak mining activity and lower electricity generation, government data showed on Friday (Oct 11).
Industrial output fell 0.1 per cent year-on-year in August, contrary to economists’ expectations of 1.2 per cent growth in a Reuters poll.
The index had previously registered a contraction in October 2022, when it fell 4.1 per cent. Industrial output grew 4.7 per cent in July.
Manufacturing output rose 1 per cent year-on-year, while electricity generation fell 3.7 per cent and mining activity fell 4.3 per cent, the data showed.
The sectors had grown by 10 per cent, 15.3 per cent and 12.3 per cent, respectively, a year ago.
“The marginal contraction in August 2024 is not alarming, as it largely reflects the temporary dousing of mining output, electricity demand and retail footfalls by the heavier than normal rains,” said Aditi Nayar, economist at ICRA.
In the April-August period, industrial output growth slowed to 4.2 per cent from a revised 6.2 per cent jump a year earlier.
“Expect growth rates to be better from September onwards with a peak being achieved by October end which would be the post-harvest and festival season,” said Madan Sabnavis, economist at Bank of Baroda. REUTERS
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