Industrial output encouraging; will have bearing on GDP: FM

Finance Minister Pranab Mukherjee today described the industrial output in December as encouraging and said it would have a positive bearing on the economic growth figures for the current fiscal.

"It (IIP growth rate in December) is quite encouraging and I do hope that third quarter GDP figures will also be encouraging... It will get reflected in the overall GDP," he said while talking to reporters here.

The Index of Industrial Production (IIP), an indicator of industrial activity in the country, zoomed 16.8 per cent in December against the contraction of 0.2 per cent during the corresponding month a year ago.

Higher than anticipated industrial growth rate in December may also have a reflection on the over all Gross Domestic Product (GDP), which was pegged at 7.2 per cent for the current fiscal by the Central Statistical Organisation (CSO) earlier in the week.

The advance growth estimate by the CSO, was lower than 7.75 per cent projected by the Finance Ministry and 7.5 per cent predicted by the Reserve Bank of India.

Mukherjee, who is gearing up to present the Budget 2010-11 on February 26, suggested that the higher industrial output during the month might push up the GDP for the third quarter and subsequently for the fiscal.