Industrial production growth moderates to 0.6% in February 2013

India's industrial production growth rose at moderated pace of 0.6% in February 2013 compared to 2.4% increase in January 2013 and 4.2% growth for February 2012. However, the industrial production growth for February 2013 has beaten the economists forecast of 1.5% dip expected for February 2013.

The industrial production growth for February 2013 has beaten the economists forecast of 1.5% dip expected for February 2013. As per the poll of economists conducted by Capital Market, IIP growth was expected to turn negative at 1.5% in February 2013 from growth of 2.4% in January 2013. The economists responding to the poll had forecasted the IIP growth in the wide range of 0.1% to (-) 3.0% for February 2013. The median of various IIP growth forecasts received from economists stood at (-) 1.5%, while the average stood at (-) 1.4% for February 2013. Among the twelve economists responding to poll, only one economist had projected IIP growth to be positive at 0.1% for February 2013. However, all other economists had expected sharp in industrial production for February 2013.

The marginal growth in industrial production for February 2013 was driven by the heavyweight manufacturing sector recording 2.2% growth for February 2013, which moderated from 2.5% in January 2013. On the other hand, the electricity generation output declined 3.2% in February 2013, snapping consistent growth for last seven and half years. Further, the mining sector continued to record sharp decline in output at (-) 8.1% during February 2013.

The pace of decline in electricity generation and mining output was sharpest since we have date from April 1982.

As per the used based classification, the output of capital goods rebounded 9.5% in February 2013, snapping decline for last three sequential months. However, the decline in the mining and electricity generation output at record pace caused decline in the output of basic goods at 1.8% in February 2013, snapping consistent growth for last four-years. The output of intermediate goods also declined 0.7%, while the output of consumer goods rose at moderated pace of 0.5% in February 2013. Among the consumer goods, the output of consumer non-durable increased 2.9%, but that of consumer durable declined 2.7% in February 2013.

In terms of industries, thirteen (13) out of the twenty two (22) industry groups (as per 2-digit NIC-2004) in the manufacturing sector have shown positive growth during the month of February 2013 as compared to the corresponding month of the previous year (Statement II). The industry group 'Electrical machinery and apparatus n.e.c.' has shown the highest positive growth of 73.0%, followed by 18.5% in 'Wearing apparel; dressing and dyeing of fur' and 12.6% in 'Luggage, handbags, saddlery, harness & footwear; tanning and dressing of leather products'. On the other hand, the industry group 'Medical, precision & optical instruments, watches and clocks' has shown a negative growth of 27.6% followed by 25.6% in 'Publishing, printing and reproduction of recorded media' and 17.8% in 'Motor vehicles, trailers & semi-trailers'.

Some of the important items showing high positive growth during the current month over the same month in previous year include 'Cashew Kernels' (83.4%), 'Apparels' (16.0%), 'Leather Garments' (39.6%), 'Vitamins' (121.2%), 'Heat Exchangers' (61.5%), 'Conductor, Aluminium' (66.0%), 'Cable, Rubber Insulated' (188.5%), 'Generator/ Alternator' (47.9%) and 'Ship Building & Repairs' (105.4%).

Some of the other important items showing high negative growth are: 'Biscuits' [(-) 26.8%], 'Polythene Bags including Hdpe & Ldpe Bags' [(-) 44.5%] 'Grinding wheels' [(-) 34.2%], 'Stampings & Forgings' [(-) 24.4%], 'Razor Blades/ Safety Blades' [(-) 32.6%], 'Fasteners' [(-) 27.6%], 'Tractors (complete)' [(-) 19.4%], 'Machine Tools' [(-) 51.9%], 'Earth Moving Machinery' [(-) 20.0%] and 'Commercial Vehicles' [(-) 23.6%].

The growth rate industrial production for November 2012 was revised downward to (-) 1.01% at second or final revision, while that for January 2013 was retained unchanged at 2.4% as reported provisionally. The indices for January 2013 have undergone the first revision and those for November 2012 have undergone the final revision in the light of the updated data received from the source agencies.

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