India’s industrial output fell to an 18-month low, contracting by 0.8% in August, primarily due to a decline in output of the manufacturing and mining sectors, according to government data released on Wednesday, October 12, 2022.
According to data, the previous low in industrial output growth was a contraction of 3.2% in February 2021.
Factory output, measured in terms of the Index of Industrial Production (IIP), had expanded by 13% in August 2021. The IIP increased by 2.2% in July this year.
IIP measures the manufacturing activity in various sectors of an economy. It measures the amount of industrial production for the period under review. This macroeconomic data shows the state of various important economic sectors.
The manufacturing sector contracted by 0.7% in August 2022 compared to the 11.1% growth recorded in the year-ago period, according to data released by the Ministry of Statistics and Programme Implementation.
The power sector grew 1.4% against a 16% rise in the year-ago period. The mining sector showed a contraction of 3.9% in August 2022, whereas there was a growth of 23.3% in the year-ago period.
During April-August this year, IIP grew 7.7% compared to 29% growth in the same period a year ago.
Capital goods output, which is a measure of investments, increased by 5% in August 2022 against 20% growth in August 2021.
The consumer durables segment shrank by 2.5% from 11.1% growth a year ago.
The primary goods sector, which accounts for around 34% of the index, expanded 1.7% in August compared to 16.9% growth in the year-ago period.
The ministry said the growth rates over the corresponding period of the previous year are to be interpreted, considering the unusual circumstances on account of the COVID-19 pandemic since March 2020.
In April 2020, industrial production had contracted 57.3% due to a decline in economic activities in the wake of the lockdown imposed to control the spread of coronavirus infections.
Retail inflation data for September was also released on Wednesday. It showed CPI rose to 7.4% during the month owing to a rise in food prices, particularly vegetable prices which surged by over 18%.
The Food Price Index was at 8.6% in September this year. Cereal inflation surged 11.53% during the month.