From Swati Dayal
New Delhi, May 10 (KNN) Ten out of 22 industry groups witnessed a huge drop in production during March 2013, although overall industrial output managed to show growth by 2.5 per cent.

Though the manufacturing sector grew overall by 3.2 per cent in March 2013, several sectors like publishing, printing and reproduction of recorded media; office, accounting and computing machinery and fabricated metal products, except machinery and equipment continued to remain in distress, according to the official release. 

The industrial groups which showed significant growth were wearing apparel; dressing and dyeing of fur with highest positive growth of 152.3 per cent, followed by 64.6 per cent in electrical machinery and apparatus and 37.7 per cent in medical, precision and optical instruments, watches and clocks. 

“The growth of 3.2 per cent in manufacturing comes over a negative base and can hardly be looked as a revival in manufacturing. Overall slowdown in economic activity and consumer demand continues to constrain manufacturing growth.  Also, the growth within manufacturing is highly concentrated amongst top five high growth sectors in 2012-13 thereby weakening the chances of any sustainable growth in near future in manufacturing,” said President of Federation of Indian Chambers of Commerce and Industry (FICCI), Naina Lal Kidwai. 

Showing signs of recovery, the industrial growth has bounced back to 2.5 per cent in March on better performance of manufacturing and power sectors coupled with higher output of capital goods.

However, industrial production had seen a contraction of 2.8 per cent in March last year.

Commenting on IIP Data, Director General, Confederation of Indian Industry (CII) Chandrajit Banerjee said,  “A 2.5 per cent growth over a negative base of -2.8 per cent in March last year indicates that a robust and broadbased growth is elusive for the sector. What is creating concern is the growth of the mining sector which continues to be in the negative terrain. Similarly, the negative growth of consumer durables indicates subdued demand conditions reinforcing our view that the sector continues to be stymied by the high interest rates prevailing in the economy.”

However, IIP growth for February 2013 has been revised downward to 0.5 per cent from 0.6 per cent earlier, on the back of a 2.2 per cent rise in manufacturing, which constitutes about 76 per cent of industrial production.

Industrial growth for the financial year 2012-13 now stands at one per cent compared with 2.9 per cent in the previous year, official data released today showed.

March IIP was partly boosted by an improvement in exports and investments. India's exports rose for the third straight month in March, offering some relief to the high current account deficit, which hit an all-time high in the quarter to December. 

While manufacturing and electricity sectors grew by 3.2 per cent and 3.5 per cent, respectively, output in the mining sector contracted to -2.9 per cent.

Further, while capital goods recorded 6.9 per cent growth in March, consumer goods output grew 1.6 per cent during the month under review. 

In terms of industries, 10 of the 22 industry groups showed positive growth.

Although the HSBC manufacturing survey for March and April showed weak factory activity, the April PMI showed a jump in export orders, underlining the improvement in foreign demand for Indian goods.

The Reserve Bank of India last week cut its policy rate by 25 basis points for the third time this year, to 7.25 per cent, but was cautious about further policy easing. (KNN)