Feb 13, 2020
Industrial output slumps to -0.30% in Dec’19
Industrial Production: After turning positive in Dec’19 to 1.82%, industrial output decelerated once again to -0.30% Y-o-Y in Dec’19 led by negative growth in manufacturing and electricity sectors. Output had grown by 2.53% in Dec’18. This is the fourth month of FY19-20 when industrial output has turned negative. However, the rate of deceleration is much slower than the previous contractions. Cumulative growth for the period Apr-Dec 2019 slowed to 0.55% as against 4.69% growth over the corresponding period of the previous year.
Manufacturing, Mining and Electricity:
Manufacturing sector which witnessed turnaround in output growth – 2.68% – third highest for FY19-20 – in Dec’19, contracted by 1.18% in Dec’19. It grew at 2.88% during the corresponding month previous year. Out of the 23 manufacturing sub-sectors, 16 sub-sectors recorded a negative output growth primarily led by contraction in output of Computer, electronic and optical products (-24.9% Y-o-Y); Machinery and equipment n.e.c. (-20.3% Y-o-Y) and Printing and reproduction of recorded media (-15.5% Y-o-Y), among others. Cumulative growth for the period Apr-Dec 2019 was at 0.53% compared to 4.71% growth in the period of Apr-Dec 2018.
Mining output was the saving grace as it expanded by 5.42% in Dec’19 compared to a contraction of -0.95% in Dec’18. It grew by 1.81% in the previous month. Cumulative growth for the period Apr-Dec 2019 was mere 0.58% compared to 3.09% in the period Apr-Dec 2018.
Electricity sector output continued to decline, though at a reduced rate, for the fifth consecutive month. It contracted by 0.13% in Dec’19 against -5.02% in Nov’19. Cumulative growth for the period Apr-Dec 2019 moderated to 0.70% compared to 6.41% growth in the period of Apr-Dec 2018.
Primary goods: After declining for three months in a row, output growth bounced back to 2.21% in Dec’19 compared to -1.09% in Dec’18. Cumulative growth for Apr-Dec 2019 stood at 0.34% compared to 4.14% growth in Apr-Dec 2018.
Capital goods: Output, which has been contracting since Jan’19, dipped at an accelerated pace in Dec’19 to -18.22% Y-o-Y compared to 4.18% in Dec’18. Cumulative growth for the period Apr-Dec 2019 remained in the negative zone at 12.34% compared to 6.81% growth in the period of Apr-Dec 2018.
Intermediate goods: Among the use-based categories, intermediate goods sector recorded a healthy output expansion of 12.47% in Dec’19, although lower than 16.47% growth recorded in previous month. Cumulative growth for Apr-Dec 2019 stood at 12.14% compared to 0.54% growth in Apr-Dec 2018.
Infrastructure/construction goods: The output growth of infrastructure/construction remained in the negative zone for the fifth month with the contraction of 2.60% in Dec’19, compared to an output growth of 9.03% in Dec’18. Cumulative growth for the period Apr-Dec 2019 stood at a negative 2.63% compared to 8.35% growth in Apr-Dec 2018.
Consumer goods: The output of consumer durables contracted for the seventh month in a row to 6.68% in Dec’19 compared to an expansion of 4.11% in Dec’18. On the other hand, consumer non-durables which had recorded a moderate output expansion of 1.55% in Nov’19, declined to -3.73% in Dec’19. It had posted a healthy growth of 6.52% in Dec’18. Cumulative output growth of consumer durables and consumer non-durables for Apr-Dec 2019 stood at a negative growth of 6.59% and positive growth of 2.81%, respectively, compared to a positive growth of 7.42% and 4.27%, respectively, in the corresponding period of the previous fiscal.
Table 1: Top Growth Contributors at Two-digit Level
|Positive Growth (Y-o-Y %)||Negative Growth (Y-o-Y %)|
|Basic metals||14.2%||Computer, electronic and optical||(24.9%)|
|Wood and products of wood and cork,|
|except furniture; manufacture of articles||13.2%||Machinery and equipment n.e.c.||(20.3%)|
|of straw and plaiting materials|
|Leather and related products||5.9%||Printing and reproduction of||(15.5%)|
Table 2: Growth Trends in Industrial Output (Base Year 2011-12)
|Industry group||Weight||Dec-19||Apr-Dec 2019|
|Infrastructure/ construction goods||12.34||-2.6||-2.6|
|Major Manufacturing Industries (2-digit Classification)|
|Leather and related products||0.50||5.9||-0.4|
|Wood and products of wood and cork, except furniture;|
|manufacture of articles of straw and plaiting materials||0.19||13.2||11.9|
|Paper and paper products||0.87||-8.6||-12.3|
|Printing and reproduction of recorded media||0.68||-15.5||-6.2|
|Coke and refined petroleum products||11.77||1.2||-0.4|
|Chemicals and chemical products||7.87||0.8||4.8|
|Pharmaceuticals, medicinal chemical and botanical products||4.98||-3.3||2.8|
|Rubber and plastics products||2.42||-5.2||-6.5|
|Other non-metallic mineral products||4.09||1.7||-1.3|
|Fabricated metal products, except machinery and equipment||2.65||-13.7||-13.6|
|Computer, electronic and optical products||1.57||-24.9||-7.9|
|Machinery and equipment n.e.c.||4.77||-20.3||-11.2|
|Motor vehicles, trailers and semi-trailers||4.86||-12.1||-16.1|
|Other transport equipment||1.78||3.4||-5.6|
Source: Ministry of Statistics and Programme Implementation
Based on Economic Research Department The Clearing Corporation of India Limited
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