India’s industrial production growth rose to 4.2% in April from 1.1% recorded in the previous month on the back of a sharp jump in manufacturing output even though power generation declined, the government data showed.
Manufacturing output expanded by 4.9% in April 2023 on a year-on-year basis, sharply higher than 0.5% growth recorded in the previous month.
Mining sector continued strong growth. The output increased by 5.1% in April on a year-on-year basis, after recording a growth of 6.8% in the previous month. However, electricity production in April 2023 was 1.1% lower when compared with the same month last year. Power output had declined by 1.6% in March.
The industrial output as measured in terms of Index of Industrial Production (IIP) had recorded a growth of 6.7% in April 2022.
“Manufacturing showed a healthy growth of 4.9% in April. This augurs well for new investment and job creation,” said Assocham Secretary General Deepak Sood.
The push to manufacturing came from domestic-linked sectors. Consumer non-durables segment recorded a growth of 10.7% in April against a contraction of 3.1% recorded in the previous month.
Rebound in the consumer non-durables segment indicates a recovery in rural demand, amid healthy agricultural production and easing inflationary pressures in the past few months, said Dharmakirti Joshi, chief economist, CRISIL.
Infrastructure and construction goods production rose sharply by 12.8% in April against 5.4% growth recorded in the previous month, reflecting a pickup in government capital expenditure with the start of the fiscal.
Certain export-oriented sectors remain a drag, particularly chemical products (2.9% in April vs 7.0% in March), and textiles (-6.3% in April vs -7.4% in March).
“External demand is likely to be a bigger hindrance to growth with western advanced economies staring at a sharp slowdown in the coming quarters,” Joshi said.