IIP grows to 19-month high of 4.7% in May

Showing signs of recovery, industrial production grew at 19-month high of 4.7 per cent in May due to improved performance of manufacturing, mining and power sectors and higher output of capital goods.

The output, as measured by the Index of Industrial Production (IIP), had contracted by 2.5 per cent in the same month of last year.

IIP data for April remained unchanged at 3.4 per cent after revision of the provisional estimates released last month, according to the information released by the Central Statistics Office (CSO).

The IIP's previous high was recorded in October 2012 at 8.4 per cent. During the April-May period of the current fiscal, the IIP recorded a growth of 4 per cent, as against contraction of 0.5 per cent in the first two months of 2013-14.

Manufacturing, which constitutes over 75 per cent of the index, grew 4.8 per cent in May, compared to decline in output by 3.2 per cent a year ago. For April-May, the sector recorded a growth of 3.7 per cent, compared to a contraction of 0.7 per cent in the year-ago period.

Production of capital goods, a barometer of demand, grew by 4.5 per cent in May, in sharp contrast to a contraction in output by 3.7 per cent in same month of last year.

For April- May, the output has grown by 9.3 per cent, compared to the contraction of 2.1 per cent in the first two months of 2013-14.

The mining sector grew by 2.7 per cent in May as against a dip of 5.9 per a year ago. For April-May, the segment grew by 2.6 per cent, compared to decline in production by 4.7 per cent in the year-ago period.

Power generation increased by 6.3 per cent in May as compared to 6.2 per cent growth in the same month of 2013. In April-May, power output grew by 9 per cent compared to a growth of 5.3 per cent in the year-ago period. Overall, 16 of the 22 industry groups in manufacturing showed positive growth in May.

According to the IIP data, output of consumer goods grew by 3.7 per cent in May compared to the contraction of 6.6 per cent a year ago. However, in April-May, the segment showed a contraction of 0.7 per cent compared to a decline of 2.5 per cent the same period of 2013-14.

The consumer durables segment grew by 3.2 per cent in May as against a decline of 18.3 per cent previously. For April- May, it declined by 2.5 per cent as against a contraction of 14 per cent in the first two months of last fiscal.

Production of consumer non-durables also grew by 3.9 per cent, compared with a growth of 3.8 per cent in May last year. For April-May, the segment has grown by 0.5 per cent, compared to a growth of 7.6 per cent a year ago.

Output of intermediate goods expanded 2.7 per cent in May, compared to 1.1 per cent a year ago. For April-May the output has grown by 3 per cent, compared to 1.8 per cent in the first two months of last fiscal.

Basic goods output grew 6.3 per cent in May, against a dip of 0.3 per cent a year ago. For April-May, the segment has grown by 6.8 per cent compared a growth 0.5 per cent in the same period of 2013-14.