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India’s Industrial Output Growth At Seven-Month Low In May

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India’s industrial activity declined sharply in May mainly due to a slowdown in manufacturing activity, after gathering pace in April.

The index of industrial production rose 3.2 percent year-on-year in May, compared to a revised 4.8 percent in April, data released by the Ministry of Statistics and Programme Implementation showed. A Bloomberg poll of economists had projected a 4.4 percent growth.

Also Read: India’s Retail Inflation Rises To 5% In June

Thirteen out of the 23 industry groups in the manufacturing sector have shown positive growth during the month of May 2018, compared to last year. The use-based classification showed that production of primary goods rose 5.7 percent, while capital goods’ output advanced 7.6 percent.

Key Highlights:

  • Manufacturing sector output grew 2.8 percent in May compared to a 5.2 percent rise in April.
  • Electricity generation grew 4.2 percent compared to a 2.1 percent increase in April.
  • Mining activity rose 5.7 percent compared with a 5.1 percent growth in April.

The Reserve Bank of India, in its June monetary policy review had said that a slowdown in the industrial industrial activity expansion is likely in the first quarter of current fiscal. “That’s due to a significant rise in input prices and perceptions of softening domestic and external demand,” according to the MPC statement.

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