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Industrial growth in April rises marginally to 2.9 pc

Our Bureau

NEW DELHI, June 12

INDUSTRY has registered a 2.9 per cent growth in April, belying expectations of a nascent recovery on the back of buoyant trends in excise collections and pick up in non-food credit offtake.

According to the quick estimates of the Index of Industrial Production (IIP) released by the Central Statistical Organisation (CSO) here today, the 2.9 per cent year-on-year increase in the general index during April 2002 was only marginally higher than the 2.6 per cent growth recorded in April 2001 and way below the 6.5 per cent figure for April 2000.

While the manufacturing sector grew by 2.5 per cent in April 2002, against 2.7 per cent in April 2001 and 7.1 per cent in April 2000, the corresponding growth rate figures for mining and electricity stood at 4.6 per cent (3.4 per cent and 4 per cent) and 4.9 per cent (1.5 per cent and 3.7 per cent) respectively.

The average growth rates during 2001-02 as a whole, based on the CSO's latest revised data, amounted to 2.8 per cent for the general index (5 per cent in 2000-01), while being 2.8 per cent (5.3 per cent) for manufacturing, 1.8 per cent (3.7 per cent) for mining and 3.1 per cent (4 per cent) for electricity.

The industrial growth figures for April 2002 have not matched up to expectations, considering that recent official data for the six core infrastructural industries had revealed a growth rate of 5.9 per cent for the month, as against minus 0.3 per cent during the opening month of the previous fiscal.

Also, with the Centre's tax collections going up by around 20 per cent along with indications of increased credit offtake from banks, an industrial turnaround of sorts seemed well on the cards. Added to this were the improved investment outlook projections made by organisations such as the Confederation of Indian Industry (CII) and the National Council of Applied Economic Research (NCAER) .

However, the detailed use-based classification of the IIP indicates that these signs are somewhat premature. Production of capital goods — a proxy for investment demand in economy — has actually dipped by one per cent in April 2002, over and above the minus 4.4 per cent growth registered in April 2001.

The growth rates for basic and intermediate goods, too, have been lower at 3.2 per cent and 2.1 per cent per cent for April 2002, compared to their previous period levels of 3.8 per cent each.

On the other hand, there has been only a marginal decline in the growth rate for consumer durables (6.1 per cent in April 2002 versus 6.4 per cent for April 2001), even as consumer non-durables output recorded an increase in growth from 1.3 per cent to 4.1 per cent.

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