Manufacturing lifts India's October industrial output higher (Second Lead, correcting headline)

Higher production in the manufacturing sector, especially of capital goods and consumer durables, accelerated the growth of India's industrial output to 8.1 per cent in October from a rise of 4.46 per cent in September and 1.8 per cent during the corresponding period of the previous fiscal, official data showed on Wednesday.

"The cumulative growth for the period April-October 2018 over the corresponding period of the previous year stands at 5.6 per cent," the 'Quick Estimates' of IIP released by the Ministry of Statistics and Programme Implementation said.

On a YoY (year-on-year) basis, the manufacturing sector's output expanded at 7.9 per cent, while mining production edged-up by 7 per cent and the sub-index of electricity generation increased by 10.8 per cent.

Among the six use-based classification groups, the output of primary goods which has the highest weightage of 34.04 grew by 6 per cent. The output of intermediate goods, which has the second highest weightage, inched up by 1.8 per cent.

Similarly, the output of consumer non-durables rose during the month by 7.9 per cent and that of consumer durables by 17.6 per cent.

In addition, infrastructure or construction goods output increased by 8.7 per cent and capital goods by 16.8 per cent.

"The considerable uptick in industrial growth in October 2018, which is somewhat sharper than expected, reflects the impact of inventory adjustment to the later start to the festive season and a favourable base effect," said Aditi Nayar, Principal economist, ICRA.

"In ICRA's view, the pickup in industrial growth in October 2018 is likely to be temporary, as portended by the considerable deterioration in the growth performance of the available lead indicators such as auto production, electricity generation and Coal India Limited's output in November 2018."

--IANS

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