IIP growth zooms to five-year high of 9.8% in October 2015

Capital goods post double digit growth for fourth month, consumer durable production spurts at 69-months high

India's Index of Industrial Production (IIP) growth surged to 60-months high of 9.8% in October 2015 over a year ago compared with the revised growth of 3.8% in September 2015. An extremely farvourable base effect with IIP declining 2.7% in October 2014 has mainly fuel the IIP growth for October 2015. Also, the festive season shifting to November this year compared with October in last year, aided IIP growth in October 2015 driven by pre-festive season surge in production.

The output of the manufacturing sector jumped 10.6% in October 2015, against 5.6% dip in October 2014. Meanwhile, the mining sector output improved 4.7% in October 2015, showing acceleration from 4.5% growth in October 2014. The electricity generation also surged 9% in October 2015 against 13.7% jump in October 2014.

As per the use-based classification, the basic goods output increased 4.1% in October 2015 over a year ago. Meanwhile, the output of capital goods posted double-digit growth for fourth straight month at 16.1%. The intermediate goods output galloped 6.7%, while the growth of consumer goods output zoomed to 69-months high of 18.4% in October 2015. Within consumer goods, the production of consumer durables shot up 42.2%, while that of consumer non-durables also improved 4.7% in October 2015.

In terms of industries, seventeen (17) out of the twenty-two (22) industry groups in the manufacturing sector showed positive growth in October 2015 compared to the corresponding month of the previous year.

The IIP growth in September 2015 was scaled up to 3.8% in the first revision compared with 3.6% reported provisionally. Meanwhile, the growth in July 2015 was also raised to 4.3% at the final revision against 4.1% at first revisions and 4.2% reported provisionally.

The industry group 'Furniture; manufacturing' has shown the highest positive growth of 138.9%, followed by 48.4% in 'Office, accounting & computing machinery' and 47.5% in 'Radio, TV and communication equipment & apparatus'.

On the other hand, the industry group 'Publishing, printing & reproduction of recorded media' has shown the highest negative growth of (-) 10.2%, followed by (-) 6.8% in 'Medical, precision & optical instruments, watches and clocks' and (-) 2.9% in 'Coke, refined petroleum products & nuclear fuel'.

Some of the important items showing high positive growth during the current month over the same month in previous year include 'Gems and Jewellery' (372.5%), 'Sugar Machinery' (103.4%), 'Telephone Instruments including Mobile Phone and Accessories' (61.5%), 'Ethylene' (58.4%), 'PVC Pipes and Tubes' (48.5%), 'Antibiotics & its Preparations' (38.5%), 'Steel Structures' (35.5%), 'Colour TV Sets' (34.5%), 'Cable, Rubber Insulated' (31.3%), 'Aluminium wires & extrusions' (28.4%), 'Scooter and Mopeds' (24.5%) and 'Passenger Cars' (21.4%).

Some of the other important items showing high negative growth are: 'Polythene Bags including HDPE & LDPE Bags' (-) 61.8%, 'Ship Building & Repairs' (-) 46.5%, 'Grinding Wheels' (-) 36.3%, 'Instant Food Mixes (Ready to eat)'(-) 29.5%, 'Furnace Oil' (-) 25.8% and 'Aviation Turbine Fuel' (-) 24.0%.

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