India's industrial output as measured by the Index of Industrial Production (IIP) recorded 1.4 percent in the month of November 2021. According to the CNBC-TV18 Poll of Economists, the forecast IIP was pegged at 3.24 percent.
The manufacturing sector, which constitutes 77.63 percent of the Index of Industrial Production (IIP), grew 0.9 percent in November. The mining sector's output rose five percent in November, while power generation increased 2.1 percent.
The factory output recorded double-digit growth in the four months from May to August this fiscal. Then it slipped to 3.3 percent in September this fiscal and recorded a growth of four percent, mainly due to the waning low base effect.
In November 2021, the IIP stood at 128.5 points compared to 126.7 points in the same month in 2020. The index stood at 128.8 points in November 2019, as per the NSO data. Thus, the data showed fading of the low base effect. The IIP growth witnessed double-digit growth from May onwards this year on the back of the lower base effect.
The IIP had contracted by 1.6 percent in November 2020. During April-November this year, the IIP grew 17.4 percent against a 15.3 percent contraction in the same period last year.
The data showed that industrial production recovered in September 2020 and surpassed the pre-pandemic level of September 2019. The IIP had grown by one percent in September 2020. Industrial production plunged 18.7 percent in March last year following the COVID outbreak and remained in the negative zone till August 2020.
With the resumption of economic activities, factory output rose 1 percent in September 2020 and 4.5 percent in October 2020. In November 2020, it fell 1.6 percent and then entered the positive territory with a 2.2 percent growth in December 2020.
The IIP had recorded a contraction of 0.6 percent and 3.2 percent in January 2021 and February 2021, respectively. In March 2021, it grew 24.2 percent. For April 2021, the NSO held back the release of complete IIP data. In May 2021, the IIP rose 27.6 percent, and in June, it grew 13.8 percent.
The factory output grew 11.5 percent in July 2021 and 13 percent in August. The second wave of the pandemic started in the middle of April 2021, and many states imposed restrictions to curb the spread of coronavirus infections.
"The growth rates over the corresponding period of the previous year are to be interpreted considering the unusual circumstances on account of COVID 19 pandemic since March 2020," the NSO said in the statement. The government had imposed a nationwide lockdown to contain the spread of coronavirus infections on March 25, 2020.
The manufacturing sector had recorded a contraction of 1.6 percent in November 2020. The mining sector output shrank 5.4 percent in the same month. The electricity generation had grown by 3.5 percent in November 2020.
The output of capital goods, which is a barometer of investment, contracted by 3.7 percent in November 2021. It had witnessed a contraction of 7.5 percent in the year-ago period.
Consumer durables manufacturing shrank 5.6 percent in the month under review against a decline of 3.2 percent in November 2020. Consumer non-durable goods production grew 0.8 percent in November 2021 against a 0.7 percent contraction in the year-ago period.
Industrial output, or factory output, is the closest approximation for measuring the economic activity of the country's business landscape.
(Edited by : Jomy Jos Pullokaran)
First Published: IST