The Hindu Business Line : Industrial output up 6.2 pc in Dec

INDIA Inc continues to rise on a steady growth path, with the official Index of Industrial Production (IIP) registering a year-on-year increase of 6.2 per cent in December 2003 led by a 6.5 per cent manufacturing sector growth.

According to the latest IIP data released by the Central Statistical Organisation (CSO) here on Thursday, the 6.2 per cent overall year-on-year increase for December comes over and above the same level of growth recorded for the same month of the previous year.

While the manufacturing growth of 6.5 per cent for December 2003 was marginally lower than the 6.6 per cent figure for December 2002, the corresponding growth rates for the other two major sectors constituting the general IIP — mining and electricity — amounted to 4.1 per cent (6.1 per cent) and 4.9 per cent (2.8 per cent), respectively.

The cumulative growth for industry as a whole during April-December 2003 worked out to be higher at 6.3 per cent (against 5.5 per cent during April-December 2002), while correspondingly being 6.8 per cent (5.7 per cent) for manufacturing, 4 per cent (5.8 per cent) for mining and 3.4 per cent (3.8 per cent) for electricity.

A more encouraging picture emerges when one takes cognisance of the `use-based' classification of the IIP. Production of capital goods — which is a reliable proxy for level of investment activity taking place in the economy — in December 2003, went up by 9.8 per cent, over and above the 12.6 per cent growth for the same month of the previous fiscal.

For April-December 2003, the growth rate of capital goods amounted to 9.6 per cent, compared to 10.7 per cent during the corresponding nine months of 2002-03.

The growth rates during December 2003 were higher in the case of intermediate goods (9.2 per cent versus 4 per cent in December 2002) and consumer durables (10.8 per cent versus minus 3.2 per cent), while being equal to or lower for basic goods (4.7 per cent against 4.7 per cent), and consumer non-durables (1.9 per cent versus 11.5 per cent).

For April-December 2003, the cumulative growth rates were 4.5 per cent (4.8 per cent during April-December 2002) for basic goods, 6 per cent (2.7 per cent) for intermediate goods, 8.3 per cent (minus 5.6 per cent) for consumer durables and 7 per cent (12.7 per cent) for consumer non-durables.