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Saturday, August 11, 2001



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June industrial growth slips

Our Bureau


INDIAN industry has registered a first quarter growth of 2.1 per cent during the current fiscal, providing further evidence of a slowdown engulfing the economy.

The latest `quick estimates' of the Index of Industrial Production (IIP), released by the Central Statistical Organisation (CSO) here on Friday, reveals that the overall industrial growth during June 2001 stood at only 1.5 per cent, as against the corres ponding figure of 5.9 per cent for June 2000.

Among the major sectoral components of the IIP, the index for `manufacturing' registered a mere 1.9 per cent year-on-year growth in June 2001 (compared to 6.1 per cent in June 2000), while the same for `mining' and `electricity' amounted to -3 per cent ( 4.4 per cent) and 1.4 per cent (five per cent), respectively.

For the April-June 2001 quarter, the `general' index grew by 2.1 per cent (against 6.1 per cent during April-June 2000), with the corresponding growth rates being 2.3 per cent (6.4 per cent) for `manufacturing', 0.2 per cent (3.6 per cent) for `mining' a nd two per cent (5.1 per cent) for `electricity'.

The `used-based' classification of the IIP gives a better picture as to the real source of the ongoing recessionary trends. Capital goods production - a proxy for the extent of domestic investment in new plant and machinery taking place - has fallen by 4 .2 per cent during April-June 2001, as against a growth of 5.2 per cent recorded during the first quarter of the previous fiscal.

Similarly, the growth rates for basic goods and intermediate goods - which form the inputs for production of `final' consumer products - have plummeted to 1.4 per cent and 2.7 per cent, respectively during April-June 2001, from their corresponding last y ear's levels of 5.4 per cent and 4.6 per cent, respectively.

And the slowdown and loss of employment in these `producing' sectors have, in turn, led to lower demand for consumer goods. This is borne out by the fact that production of consumer durables, which rose by 22.7 per cent during April-June 2000, registered a lower growth of 7.5 per cent during April-June 2001. Similarly, the growth rate for consumer non-durables has also declined from 4.3 per cent to 3.2 per cent.

The above across-the-board sluggish trend seems to have consolidated itself further in June 2001, with the growth rates for capital goods, basic goods, intermediate goods, consumer durables and consumer non-durables, at -7.6 per cent, -0.1 per cent, thre e per cent, 8.8 per cent and 3.4 per cent, respectively, being much below their corresponding June 2000 levels of 2.9 per cent, 5.1 per cent, five per cent, 24 per cent and 4.1 per cent, respectively.

Related links:
Industrial growth slumps further to 1.9 pc in May

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