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Factory output slows down to 20-month low of 0.1% in February

India's factory output, as measured in terms of the Index of Industrial Production (IIP), slowed down to 20-month low of 0.1% in February, mainly due to contraction in the manufacturing sector. It had grown by 6.9% in February 2018. The previous low in IIP growth was recorded in June 2017, when factory output contracted 0.3%. As per the data released by the Central Statistics Office of the Ministry of Statistics and Programme Implementation, IIP with base 2011-12 for the month of February 2019 stood at 127.5, which was  0.1% higher as compared to the level in the month of February 2018. The cumulative growth for the period April-February 2018-19 over the corresponding period of the previous year stood at 4.0%. Meanwhile, IIP growth for November 2018 was revised downwards to 0.2% from 0.3% released earlier.

On the sectoral front, the manufacturing sector, which constitutes 77.63% of the IIP, contracted by 0.3% in February as compared to 8.4% expansion a year ago. Power sector growth slowed to 1.2% in February as compared to 4.5% a year ago. However, mining sector output grew 2% in the month compared to contraction of 0.4% earlier. The Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month of February 2019 stood at 112.3, 129.3 and 137.7 respectively. The cumulative growth in these three sectors during April-February 2018-19 over the corresponding period of 2017-18 has been 3.0%, 3.8% and 5.5%, respectively.

Besides, capital goods output declined by 8.8% in the month under review as against 16.6% growth in February 2018. As per use-based classification, the growth rates in February 2019 over February 2018 were 1.2% in primary goods, (-) 4.9% in intermediate goods and 2.4% in infrastructure/construction goods. Consumer durables and consumer non-durables recorded growth of 1.2% and 4.3%, respectively.

In terms of industries, 10 out of the 23 industry groups in the manufacturing sector have shown positive growth during the month of February 2019 as compared to the corresponding month of the previous year. The industry group 'Manufacture of wearing apparel' has shown the highest positive growth of 19.3% followed by 13.8% in 'Manufacture of food products' and 8.3% in 'Manufacture of wood and products of wood and cork, except furniture; manufacture of articles of straw and plaiting materials'. On the other hand, the industry group 'Manufacture of machinery and equipment n.e.c.' has shown the highest negative growth of (-) 12.8% followed by (-) 10.7% in 'Manufacture of fabricated metal products, except machinery and equipment' and (-) 9.7% in 'Manufacture of furniture'.

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