Festival demand around October in India has boosted the Index of Industrial Production (IIP) for October by 3.6pc from the previous year. Broad indices growth rate, including mining, was marginally down 1.5pc, manufacturing rose 3.5pc and electricity reported a jump of 11.2pc in October from the previous year. These major indices have pushed the general IIP index up to 128.5.
The index for mining slipped by 1.5pc to 98 while in the previous year, it was down 8pc compared to 2018. Manufacturing index, which consists of 22 industries including pharmaceuticals, chemicals, rubber, plastic, basic metals, motor vehicles, machinery and equipment, among others, grew at 3.5pc to 130.7 in October from a year ago.
Manufacture of motor vehicles was up 17.7pc in October from the prior year as manufacturers anticipated healthy demand around the festivals in October and November. Basic metals manufacturing was up by 5.6pc in the month from 2019.
In the April-October period, IIP declined 17.5pc from the prior year. September quarter’s GDP has shrunk 7.5pc from the previous year but it showed strong recovery after a massive decline of 23.9pc for June quarter. In the beginning of December, RBI and IMF, both stated that India’s recovery pace is faster-than-expected.
Care Rating’s agency, ICRA expects November IIP to register a minor decline.