India Industry April 2016


Industrial production declines slightly in April

Industrial production suffered a small contraction in April. Industrial production fell 0.8% compared to the same month last year, which followed March’s almost flat 0.1% increase. The print surprised market analysts, who had expected a modest 0.5% expansion.

April’s drop was driven by a stronger contraction in manufacturing output, which fell 3.1% annually following a 1.2% drop in March. The fall in manufacturing production offset gains made in electricity production, which grew 14.6% (March: +11.3% year-on-year), and mining, which expanded 1.4% (March: -0.1% yoy).

On a use-based classification, the contraction in capital goods intensified in April and consumer goods production experienced a mild decline. In addition, growth in production of intermediate goods remained stable, while basic goods production grew at a faster pace than in the previous month.

As a result, the trend continued to point downward. Annual average growth in industrial production eased from March’s 2.5% to 2.2%, which represented a 15-month low.

FocusEconomics panelists expect industrial production to increase 6.6% in fiscal year 2016, which is down 0.3 percentage points from last month’s forecast. For fiscal year 2017, the panel expects industrial output to expand 6.9%.

Author:, Economist

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India Industry Chart

India Industry April 2016

Note: Year-on-year and annual average variation of industrial production index in %.
Source: Ministry of Statistics and Programme Implementation (MOSPI) and FocusEconomics calculations.

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