Cii Data Signals Pickup In Industrial Production

The encouraging official figures on industrial growth in April-October 1996 appear to be vindicated by a recent study of the economy carried out by the Confederation of Indian Industry and Ascon. The study reveals that an overwhelming 71 sectors out of 90 registered either improved or consistent production during April-December 1996 compared to the same period in the previous year.

The study termed growth above 20 per cent as excellent, growth between 10-20 per cent as high and between 0-10 per cent as moderate.

The worst performance was noted in the basic goods category, which includes crude oil, natural gas, fertilisers, LPG, petrol, diesel, cement and steel. With the exception of asbestos cement products, all the other products registered a decline. Not a single sector in this category recorded excellent growth. While growth in sales of cold-rolled steel strips dipped, crude oil witnessed a decline in sales.

 

Sectors such as steel, cold-rolled steel, cement and soda ash recorded declining exports for the period studied while only caustic soda registered excellent growth in exports.

Intermediate goods such as auto components, synthetic fibre and carbon dioxide showed excellent growth while items like nylon filament yarn, jute textiles and refractories recorded a dip in production. All the other intermediate goods such as blended yarn, cotton fabric, castings, forgings and nylon tyre yarn maintained previous growth rates.

Exports in this category remained steady barring ball and roller bearings, with high-value castings recording good sales.

In the capital goods sector, while tractors, compressors and diesel engines showed improved growth rates, products such as diamond tools, pumps and electric cables declined. Growth in production of textile machinery and transmission line towers declined further during the period while production of telecom equipment decreased dramatically.

While diamond tools, compressors, earth-moving equipment and diesel engines showed a decline in exports, the other products managed to maintain their previous performance. Domestic sales for textile machinery, electrical cables and transmission line towers recorded negative growth while those of diesel engines enjoyed improved growth.

In the consumer durables category, items like medium and heavy commercial vehicles and three-wheelers recorded excellent production, while multi-utility vehicles, two-wheelers, glass and glass products and rubber goods registered high growth. Items like cotton cloth, refrigerators and plywood recorded negative growth.

Domestic sales of almost all consumer durables except water coolers showed a decline.

In the consumer non-durables category, practically all the segments including cigarettes and tobacco, newspapers, sugar, confectionery, chocolates, drugs and pharmaceuticals recorded high growth, although the growth rate actually declined for drugs and pharmaceuticals.

In the services sector, the leasing and hire purchase business showed excellent growth, while the nuclear power and construction industry registered a high growth rate. Thermal power recorded moderate growth while hydro-electric power continued to show a negative trend.