October industrial output will show revival of growth: Montek

Projecting economic revival in the second half of the current fiscal, Planning Commission Deputy Chairman Montek Singh Ahluwalia today said the October data for industrial production would show recovery.

"Finance Minister has said that second half of this fiscal (would register higher economic growth). That means beginning of this month onwards, when the data for this period becomes available, you will begin to see revival in the growth process including in the index of industrial production," he told reporters here.

Asked as to when would one see the growth revival, he replied, "The IIP data for October will be available in December."

After recording modest growth in July, industrial output again slowed down sharply to 0.6% in August mainly on account of a contraction in manufacturing and mining.

Factory output, which showed some signs of recovery after recording a growth of 2.8% in July, remained almost flat year-on-year because of a slump in production of consumer goods and durables.

Reeling under the impact of slowdown, Indian economy grew by 5% in 2012-13, the first year of the 12th Plan. The economic growth is expected to be in the same region this year. The first quarter (April-June) economic growth in this fiscal has slipped to 4.4% from 4.8% the previous January-March quarter.

About the impact of good monsoon on economy, Ahluwalia said: "Agriculture growth in the last fiscal was 2.9%. If we get 5% agriculture growth this fiscal then...The 2.1% higher agriculture growth would translate into 0.4% more economic growth.

"Moreover the agriculture income increased the demand for manufactured goods. I think that good agriculture production this year would have very positive affect on overall economy."