Industrial output contracts 0.1% in March, lowest in 21 months

India's industrial production contracted by 0.1% in March this year, the lowest in 21 months, mainly due to manufacturing sector slow down, official data showed Friday.

Factory output, as measured in terms of the Index of Industrial Production (IIP), had grown by 5.3% in March 2018, according to data released by the Central Statistics Office (CSO).IIP's previous low was recorded in June 2017, when output shrank by 0.3%. On annual basis, IIP growth slowed to three-year low of 3.6% in the 2018-19 fiscal as against 4.4% in the previous fiscal.
Industrial production growth was 4.6% and 3.3% in 2016-17 and 2015-16, respectively.

Meanwhile, IIP growth for February 2019 has been revised downwards to 0.07% from 0.1% earlier.The manufacturing sector, which constitutes 77.63% of the IIP, contracted by 0.4% in March as compared to 5.7% expansion in the year-ago month.Capital goods output declined by 8.7% in the month under review as against 3.1% contraction in March 2018.

Power sector growth slowed to 2.2% in March as compared to 5.9% a year ago. Mining sector growth also dropped to 0.8% in March compared to 3.1% expansion a year ago.
As per use-based classification, growth rates in March 2019 are 2.5% in primary goods, (-) 2.5% in intermediate goods and 6.4% in infrastructure/ construction goods.
Similarly, consumer durables and consumer non-durables have recorded growth of (-) 5.1% and 0.3%, respectively.

In terms of industries, 12 out of 23 industry groups in the manufacturing sector have shown negative growth during March 2019 as compared to same month a year ago.