India: Industrial output records slight expansion in January
March 12, 2014
Industrial production expanded 0.1% over the same month last year in January, according to the Quick Estimate of the Index of Industrial Production (IIP). The reading contrasted both the revised 0.2% contraction observed in December (previously reported:-0.6% year-on-year) and the 0.9% decrease the market had expected. The reading marked the first expansion after three consecutive periods of contraction. An increase in mining and quarrying along with healthy growth in electricity production were the main drivers behind January's result. Conversely, manufacturing output, which accounts for three quarters of total industrial output, contracted in January, albeit less severely that in December (January 2014: -0.7% yoy; December 2013: -1.2% yoy). Despite the expansion, annual average growth in industrial output fell from December's 0.6% to 0.4% in January. FocusEconomics panelists expect industrial production to increase 4.2% in fiscal year 2014/2015, which is up 0.2 percentage points from last month's forecast. For fiscal year 2015/2016, the panel expects industrial output to expand 5.1%.
Author: Ricardo Aceves, Senior Economist