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Industry posts 9.4 pc growth in April

Our Bureau

New Delhi , June 11

IT has been standard practice for any new Government to blame the previous regime for all its inherited woes that significantly constricts flexibility in economic decision-making. But the present Government has little room for complaint, at least in the overall macroeconomic sphere.

The latest quick estimates of the Index of Industrial Production (IIP) for April, released by the Central Statistical Organisation (CSO) here on Friday, show that Indian industry registered a healthy 9.4 per cent growth during the first month of the current fiscal, as against 4.2 per cent during April 2003. This comes just a fortnight after the Commerce Ministry's export data for April pointing at a 19.95 per cent growth in dollar terms.

When seen in conjunction with other `positive' indicators — forex reserves touching a comfortable $119.82 billion as on May 28 and the Centre's fiscal, revenue and primary deficits for 2003-04 ending up way below the budget as well as revised estimates — it would seem that the ground conditions cannot be more favourable for the Finance Minister, Mr P. Chidambaram, to present yet another `dream Budget' for 2004-05. The only pressure points are high global oil prices and the annual wholesale inflation rate edging up beyond 5 per cent, which a good monsoon would hopefully tackle.

The 9.4 per cent industrial growth for April has been powered by the `manufacturing' index, which has recorded a year-on-year increase of 9.2 per cent, compared to 4.3 per cent in April 2003. The other two major sectors comprising the general IIP - `mining' and `electricity' — have also notched up higher growth rates of 9.5 per cent (6.3 per cent) and 10.7 per cent (1.9 per cent), respectively. The buoyant numbers for the opening month of the current fiscal follows an overall industrial growth rate of 6.9 per cent during 2003-04, against 5.7 per cent for 2002-03.

The `use-based' classification of the IIP provides further encouraging news. The index for `capital goods' — considered a reliable proxy for investment activity in the economy — has surged by 23.2 per cent in April, which is on top of a year-on-year growth of 6.5 per cent for the same month of the preceding fiscal.

The indices for `basic goods,' `intermediate goods' and `consumer durables' have also correspondingly registered higher growth rates of 8.2 per cent (2.8 per cent), 9.4 per cent (2.1 per cent) and 17.7 per cent (0.4 per cent), respectively.

Only consumer non-durables have shown a lower growth of 3.5 per cent during April 2004, compared to 9.1 per cent in April 2003.

On the whole, industry is certainly on a roll now.

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