IIP growth improves to 2.5% in September 2014

IIP growth slows to 1.1% in Q2FY2015 from 4.5% in Q1FY2015

India's Index of industrial production (IIP) growth improved to 2.5% in September 2014 compared with 0.5% (revised) increase in August 2014. The manufacturing sector's output growth rebounded to 2.5% in September 2014, snapping decline for last two sequential months mainly contributing to the improvement in IIP growth. However, the mining sector as well as electricity generation growth decelerated to 0.7% and 3.9%, respectively in September 2014.

As per used-based classification, output of basic goods increased 5.1% in September 2014, with the healthy growth in the output of basic metals. Output of intermediate goods rose 1.8%, while capital goods output galloped 11.6% in September 2014. However, the output of consumer goods continued to decline at 4.0% in September 2014. Within in the consumer goods, production of consumer durable dipped 11.3% and those of consumer non-durable rose 1.5% in September 2014.

The IIP growth for June 2014 was revised upwards to 4.3% at its second and final revision compared with 3.9% at its first revision and 3.4% released originally. Meanwhile, the growth for September 2014 was scaled up slightly to 0.5% at its first revision compared with 0.4% reported provisionally.

In terms of industries, fifteen (15) out of the twenty-two (22) industry groups in the manufacturing sector showed positive growth in September 2014, compared with the corresponding month of the previous year.

The industry group 'Electrical machinery & apparatus' has shown the highest positive growth of 29.9%, followed by 19.1% in 'Other transport equipment' and 12.3% in 'Basic Metals'.

On the other hand, the industry group 'Radio, TV and communication equipment & apparatus' has shown the highest negative growth of (-) 43.8%, followed by (-) 34.2% in 'Office, accounting & computing machinery' and (-) 4.4% in 'Chemicals and chemical products'.

Some of the important items showing high positive growth during the current month over the same month in previous year include: 'H R Sheets' (212.5%), 'Stainless/ alloy steel' (78.5%), 'Cable, Rubber Insulated' (60.9%), 'Leather Garments' (53.3%), 'Colour TV sets' (47.2%), 'Air Conditioner (Room)' (42.7%), 'Scooter and Mopeds' (40.7%), 'Ayurvedic Medicaments' (36.0%), 'Transformers (small)' (34.8%), 'Fasteners (Excl. Zip-Fasteners)' (34.4%) and 'Three-Wheelers (including passenger & goods carrier)' (26.6%).

Some of the other important items showing high negative growth are: 'Telephone Instruments (incl. Mobile Phones & Accessories)' (-) 53.6%, 'Di Ammonium Phosphate (DAP)' (-) 42.0%, 'Sacking' (-) 39.7%, 'Computers' (-) 39.0%, 'Marble Tiles/ Slabs' (-) 32.8%, 'Cigarettes (-) 31.3%, 'Insulated Cables/ Wires all kind' (-) 30.0%, 'Antibiotics & Its Preparations' (-) 25.0% and 'Earth Moving Machinery' (-) 24.6%.

IIP growth slows to 1.1% in Q2FY2015

The IIP growth has shown moderation to 1.1% in the quarter ended September 2014 (Q2FY2015) from healthy 4.5% growth recorded in Q1FY2015. The manufacturing sector's output growth eased sharply to 0.1% in Q2FY2015 from 3.9% in Q1FY2015. Meanwhile, the mining as well as electricity generation sectors also witnessed slowdown in the growth to 1.3% and 9.4%, respectively in Q2FY2015.

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