<p>New Delhi: India’s industrial production growth slowed to 4.9% in March 2024 from 5.6% recorded in February, mainly due to poor performance of the mining sector and capital goods, and an expected slowdown in infrastructure expenditure.</p><p>However, the manufacturing sector witnessed stronger expansion on the back of some pick-up in consumption sentiment, official data showed on Friday.</p><p>For the full financial year 2023-24, the growth in factory output, measured in terms of the Index of Industrial Production (IIP), averaged 5.8%. This is higher than 5.2% expansion recorded in 2022-23.</p>.<p>As per data released by the National Statistical Office, manufacturing sector growth accelerated to 5.2% in March from 1.5% recorded in the same month last year. Growth in mining production slipped to 1.2% in March 2024 from 6.8% recorded in March 2023.</p><p>Dharmakirti Joshi, Chief Economist at Crisil, said the slower growth in industrial production is likely to hit overall GDP growth in the fourth quarter of 2023-24, for which official data is scheduled to be released at the end of May.</p><p>“The slowdown in March was driven by infrastructure and construction goods, reflecting moderating government capital expenditure at the end of the fiscal,” Crisil’s Joshi said.</p>.<p>Growth in the manufacturing and electricity sectors witnessed some acceleration countering the slowdown in mining output. Electricity production expanded by 8.6% in March against a contraction of 1.6% recorded in the same month last year.</p><p>As per use-base classification, growth in the capital goods segment slowed to 6.1% in March 2024 from 10% recorded in the same month last year. On the consumption front, output of consumer durables grew by 9.5% in March whereas non-durables output growth turned positive, rising by 4.9% following two consecutive months of contraction.</p><p>“The consumption scenario remained mixed in FY24 with urban demand showing resilience while rural demand continued to lag,” said Rajani Sinha, Chief Economist, CareEdge Ratings.</p>.<p>“However, expectation of a good monsoon, moderating inflation, and signs of pick-up in rural demand are positives for the overall consumption scenario,” Sinha said.</p>.<p>During FY24, there was wide variation in the monthly IIP output data. The lowest growth during the fiscal was recorded in November at 2.5%, while the highest was in October at 11.9%.</p>.<p>This wide variation in growth, according to Paras Jasrai, senior analyst at India Ratings and Research, indicates that the “factory output is still not stable and assuring”.</p>.<p>According to Aditi Nayar, Chief Economist, ICRA, the IIP growth is likely to decelerate further in April due to unfavourable base. IIP growth in April 2023 stood at 4.6%, while in March 2023 it was 1.9%. </p>
<p>New Delhi: India’s industrial production growth slowed to 4.9% in March 2024 from 5.6% recorded in February, mainly due to poor performance of the mining sector and capital goods, and an expected slowdown in infrastructure expenditure.</p><p>However, the manufacturing sector witnessed stronger expansion on the back of some pick-up in consumption sentiment, official data showed on Friday.</p><p>For the full financial year 2023-24, the growth in factory output, measured in terms of the Index of Industrial Production (IIP), averaged 5.8%. This is higher than 5.2% expansion recorded in 2022-23.</p>.<p>As per data released by the National Statistical Office, manufacturing sector growth accelerated to 5.2% in March from 1.5% recorded in the same month last year. Growth in mining production slipped to 1.2% in March 2024 from 6.8% recorded in March 2023.</p><p>Dharmakirti Joshi, Chief Economist at Crisil, said the slower growth in industrial production is likely to hit overall GDP growth in the fourth quarter of 2023-24, for which official data is scheduled to be released at the end of May.</p><p>“The slowdown in March was driven by infrastructure and construction goods, reflecting moderating government capital expenditure at the end of the fiscal,” Crisil’s Joshi said.</p>.<p>Growth in the manufacturing and electricity sectors witnessed some acceleration countering the slowdown in mining output. Electricity production expanded by 8.6% in March against a contraction of 1.6% recorded in the same month last year.</p><p>As per use-base classification, growth in the capital goods segment slowed to 6.1% in March 2024 from 10% recorded in the same month last year. On the consumption front, output of consumer durables grew by 9.5% in March whereas non-durables output growth turned positive, rising by 4.9% following two consecutive months of contraction.</p><p>“The consumption scenario remained mixed in FY24 with urban demand showing resilience while rural demand continued to lag,” said Rajani Sinha, Chief Economist, CareEdge Ratings.</p>.<p>“However, expectation of a good monsoon, moderating inflation, and signs of pick-up in rural demand are positives for the overall consumption scenario,” Sinha said.</p>.<p>During FY24, there was wide variation in the monthly IIP output data. The lowest growth during the fiscal was recorded in November at 2.5%, while the highest was in October at 11.9%.</p>.<p>This wide variation in growth, according to Paras Jasrai, senior analyst at India Ratings and Research, indicates that the “factory output is still not stable and assuring”.</p>.<p>According to Aditi Nayar, Chief Economist, ICRA, the IIP growth is likely to decelerate further in April due to unfavourable base. IIP growth in April 2023 stood at 4.6%, while in March 2023 it was 1.9%. </p>