V-shaped recovery of economic activity continues in Oct: CEA KV Subramanian

Chief Economic Adviser K V Subramanian on Saturday said V-shaped recovery of economic activity continued in October and both factory output and core sector growth have inched up to the pre-Covid level. The Index of Industrial Production (IIP) rose 3.6 per cent in October, mainly due to better performance of the manufacturing and electricity generation sectors.

The manufacturing sector, which has a weightage of 77.6 per cent in the IIP, recorded a growth of 3.5 per cent in October. In the year-ago period, the sector had a contraction of 5.7 per cent, according to data released by the National Statistical Office (NSO) on Friday.

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"V-shaped recovery of economic activity continued in Oct... IIP & eight-core index further inched up to pre-Covid levels. The broad-based recovery in IIP resulted in a growth of 3.6 per cent in October 2020 as compared to a contraction of 6.6 per cent in Oct-19," he said in a series of tweets.

Growth in IIP and eight core industries is on the back of broad-based growth in all the sectors and the consumer and investment goods were the main drivers of IIP growth in October 2020, he said.

"Across the board recovery: 243 out of 407 items in IIP basket grew in Oct-20. In contrast, 217 items grew on average in pre-Covid period (Apr-12 to Feb-20). The similar numbers for Sep-20 and Apr-20 were 196 and 28, respectively," he added.