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June IIP growth hits five-month high of 7%

Author: PTI/Saturday, August 11, 2018/Categories: Economy

June IIP growth hits five-month high of 7%

New Delhi - Industrial output recorded a five-month high growth of 7% in June as production of consumer durables and capital goods picked up pace ahead of festival season, showed government data.

Factory output growth, measured in terms of the Index of Industrial Production (IIP), was revised upwards for May at 3.9% from the previous estimate of 3.2%, according to data released by the Central Statistics Office (CSO) today.

The IIP had shown a marginal decline of 0.3% in June 2017.

As per the data, the first quarter IIP growth stands at 5.2% with manufacturing also recording the same growth. The IIP growth in the year-ago period was 1.9%.

Of the 23 industry groups, 19 recorded positive growth with computer and electronics segment expanding at 44%.

"Excellent numbers of IIP growth for June. IIP rises by 7%. Capital goods growth is 9.6%," said Economic Affairs Secretary Subhash Chandra Garg.

Consumer durable segment recorded an impressive growth of 13.1% in June compared to a decline of 3.5% in the year-ago month.

The 9.6% growth in capital goods segment in June compares with a decline of 6.1% in the same month last year.

The data showed the manufacturing sector, which constitutes 77.63% of the index, grew by 6.9% in June, as against a decline of 0.7% in the year-ago month.

Power generation segment saw a rise of 8.5% during the month as compared to 2.1% growth a year ago.

The mining sector output recorded an impressive growth of 6.6% in June as against 0.1% in June 2017.

Commenting on the data, CCI Director General Chandrajit Banerjee said that industrial output has bounced back sharply and it augurs well for a broad based recovery in industrial performance during the year.

"Even on a low base of last year, this could be the reflection of the positive investment trend, in sectors such as roads, railways and affordable housing," he said.

Anil Khaitan, President of PHDCCI, said growth of capital goods at 9.6% is inspiring as the investment cycle is expected to rebound in the coming months.

The CSO data also showed that 'manufacture of computer, electronic and optical products' has shown the highest positive growth of 44.1% followed by 20.5% in 'manufacture of motor vehicles, trailers and semi-trailers' and 15.6% in 'manufacture of other transport equipment'.

On the other hand, the industry group 'other manufacturing' showed the highest decline of (-) 40.2% followed by (-) 31.7% in 'manufacture of tobacco products' and (-) 0.8% in 'manufacture of textiles'.

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