New Delhi, Dec 10 (Bureau) The Index of Industrial Production (IIP) grew by 3.2 per cent in October 2021, as compared to the corresponding period in the past year, as per the data released by the government on Friday. The IIP growth rate is marginally lower than in September 2021 which registered a 3.3 per cent surge. In October, a high production was recorded by the manufacturing and electricity sectors. “For the month of October 2021, the quick estimates of IIP with base 2011-12 stands at 133.7. The indices of industrial production for the mining, manufacturing and electricity sectors for the month of October 2021 stand at 109.7, 134.7 and 167.3 respectively,” the Ministry of Statistics and Programme Implementation said in a statement. As per use-based classification, the indices stand at 128.5 for primary goods, 90.3 for capital goods, 143.7 for intermediate goods and 151.8 for infrastructure/ construction goods for the month of October 2021. Further, the indices for consumer durables and consumer non-durables stand at 125.6 and 149.5 respectively for October 2021.
The numbers released for October point towards the waning of low base effect, as was also reflected in September. According to Aditi Nayar, Chief Economist, ICRA, industrial growth was a stable yet tepid 3.2% in October 2021 with the festive season boost being negated by the supply side issues afflicting the auto sector, as well as a higher base. “The disaggregated data does not provide convincing signals of the recovery becoming durable and broad-basing further. In MoM terms, the IIP excluding electricity rose by 4.8% in October 2021, trailing the 8.2% uptick in the generation of GST e-way bills, to their all time high in that month. Notwithstanding the upcoming festive season, consumer durables reported a YoY contraction for the second month in a row, and the pace of the same widened in October 2021, partly attributable to the supply side shortages constraining auto output.
Moreover, consumer non-durables displayed a sub-1% rise for the second consecutive month in October 2021, adding heft to the view that the demand recovery is as yet tentative,” says Nayar. Even as the ongoing supply challenges in the auto sector persisted, the YoY performance of several other high frequency indicators deteriorated in November 2021, including electricity demand, GST e way bills, port cargo traffic etc. suggesting that economic activity lost steam after the festive season ended, with a satiation of pent up demand. Accordingly, the IIP growth may print sub-3% in the just-concluded month, in spite of the low base (-1.6% in Nov 2020), the ICRA analysis suggests.