IIP growth increased to 6.4 percent, consistent with indirect tax revenue performance. The output of consumer goods was higher by 6.8 percent. The factory output had grown by 0.5 percent in August a year ago.
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India’s August industrial output sprang a positive surprise, leapfrogging from 0.5 per cent to 6.4 per cent year-on-year, but the retail inflation in September showed an up-tick by growing at 4.41 per cent due to rise in food prices, especially pulses. CPI food inflation for September rose nearly four per cent over a year before, on the back of poor rainfall, compared with 2.2 per cent in August.
“Reduction in the interest rates last month by RBI is expected to encourage investment and aggregate demand in the economy”.
“The growth in manufacturing seems to be accelerating and we are hopeful of higher growth in the coming months. The Centre’s efforts to revive manufacturing has started to yield results”, Ficci secretary-general A. Didar Singh said. They said higher level of demand in the upcoming festival season is expected to lend weight to the turnaround of the sector. Gems and jewellery contributed 1.1 percentage points to the IIP growth in July and 1.2 percentage points to IIP growth in June.
According to the Central Statistics Office (CSO), which released the data on the Index of Industrial Production (IIP), the country’s factory output during April-August period grew by 4.1 percent. “Capital goods jumped up by 21.8%, its tenth increase in the last eleven months, showing that the push by the government to infrastructure was beginning to have an effect”, said Rishi Shah, economist at Deloitte, a consultancy firm.
“In seasonally adjusted terms, the IPI in August 2015 declined by 0.9% month-on-month as the mining index decreased by 10.2%”.
The cumulative growth for the period April-August 2015-16 over the corresponding period of the previous year stood at 4.1%, it said.
The consumer durables goods output grew at 17 percent in August as compared to a contraction of 15 percent in the same month a year ago.
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It said year-on-year, the manufacturing sector output grew slightly faster by 4.3% in August 2015 after an increase of 4.2% in July 2015.
