India Industry November 2015


India: Industrial production drops in November

January 15, 2016

In November, industrial production fell 3.2% compared to the same month last year, which marked the first contraction in one year and the worst result since October 2011. The reading contrasted October’s 9.9% increase, which had marked a multi-year high, and surprised market analysts who had expected a 2.3% expansion.

November’s drop was driven by a notable deterioration in manufacturing, which swung from 10.6% growth in October to a 4.4% contraction. In addition, notable slowdowns were tallied in mining and electricity production. Growth in mining output eased from 5.2% in October to 2.3% in November, while electricity production grew a meagre 0.7% (October: +9.0% year-on-year).

On a use-based classification, the slowdown was driven by a notable contraction in the production of capital goods. In addition, basic goods and intermediate goods fell over the same month of last year, while growth in consumer goods eased significantly.

As a result of the fall in industrial production, the trend points downward in November. Annual average growth in industrial production eased from October’s 4.4% to 3.7%.

FocusEconomics panelists expect industrial production to increase 5.5% in fiscal year 2015, which is up 0.1 percentage points from last month’s forecast. For fiscal year 2016, the panel expects industrial output to expand 6.4%.

Author: Angela Bouzanis, Lead Economist

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India Industry Chart

India Industry November 2015

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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