Industrial production in positive territory after 2 months

Industrial production growth entered positive territory after a gap of two months with a record 22.4 per cent rise in March this year, mainly due to the low-base effect and good show by manufacturing, mining and power sectors.

The manufacturing sector -- which constitutes 77.63 per cent of the index of industrial production (IIP) -- grew by 25.8 per cent in March 2021, as per the data released by the National Statistical Office (NSO) on Wednesday.

The mining sector output too grew 6.1 per cent in March, while power generation increased by 22.5 per cent.

Industrial production had plunged 18.7 per cent in March last year following the COVID-19 outbreak and remained in the negative zone till August 2020.

With the resumption of economic activities, factory output posted a rise of one per cent in September.

The IIP had grown by 4.5 per cent in October.

In November 2020, the factory output fell 1.6 per cent, and it again entered the positive territory by growing 2.2 per cent in December 2020.

The IIP had recorded a contraction of 0.9 per cent in January and 3.4 per cent in February this year.

The government had imposed a lockdown to contain the spread of COVID-19 infections on March 25, 2020.

With the gradual relaxation of restrictions, there has been a relative improvement in the economic activities by varying degrees as well as in data reporting, the Ministry of Statistics and Programme Implementation had said in a statement issued in November.

The ministry had also given a disclaimer that it may not be appropriate to compare the IIP in the post-pandemic months with the data for the months preceding the COVID-19 outbreak.

The manufacturing sector had recorded a contraction of 22.8 per cent in March 2020.

Mining sector output too fell by 1.3 per cent in the same month last year.

The electricity generation had declined by 8.2 per cent in March 2020.

The output of capital goods, which is a barometer of investment, grew by 41.9 per cent in March 2021, as against a contraction of 38.3 per cent a year ago.

Consumer durables manufacturing increased by 54.9 per cent in the month under review, compared to a 36.8 per cent decline in March 2020.

Consumer non-durable goods production grew 27.5 per cent in March this year, compared to a contraction of 22.3 per cent in the year-ago period.

During 2020-21, the IIP contracted 8.6 per cent as against 0.8 per cent contraction in 2019-20.

Photograph: Rupak De Chowdhuri/Reuters