IIP growth remains subdued for second month in a row

India’s industrial production growth remained subdued for the second straight month and expanded by 3.2% in October, mainly due to the waning base effect while mining, power and manufacturing sectors performed well.

The manufacturing sector, which constitutes 77.63% of the Index of Industrial Production (IIP), grew 2% in October, according to data from the National Statistical Office (NSO). Mining sector output rose 11.4% in October, while power generation increased 3.1%.

Factory output recorded double-digit growth in each of the four months from May to August. It then slipped to 3.3% in September and further to 3.2%, mainly due to waning low base effect.

In October 2021, the IIP stood at 133.7 points compared with 129.6 points a year earlier. The index stood at 124 points in October 2019, data showed.

The second wave of the pandemic started in the middle of April this year, and many States imposed restrictions to curb the spread of infections.

“Growth rates over the corresponding period of the previous year are to be interpreted considering the unusual circumstances on account of COVID-19 pandemic since March 2020,” the NSO said in the statement.

Output of capital goods, a barometer of investment, contracted 1.1% in October 2021. It had witnessed a growth of 3.2% a year earlier. Consumer durables manufacturing contracted 6.1% against a growth of 18.1% in October 2020. Consumer non-durable goods production grew 0.5% in October against a 7.3% rise in the year-earlier period.