India Industry November 2016


India: Industrial production grows at fastest rate in over one year in November

January 12, 2017

Industrial production in India surged in November, growing at the fastest pace since October 2015. Industrial output expanded 5.7% compared to the same month of 2015, which contrasted October’s 1.8% rise. The print notably overshot market analysts’ expectations of a subdued 1.5% expansion, partly as a result of the government’s demonetization program.

November’s result was driven chiefly by a rebound in manufacturing output, which increased 5.5% annually, contrasting the 2.4% contraction in October. In addition, electricity output grew 8.9% after posting weaker growth of 1.1% in October, while mining output expanded 3.9% (October: -0.7% year-on-year).

On a use-based classification, the production of capital goods increased notably. Consumer goods and basic output also picked up pace, while the production of intermediate goods grew steadily.

As a result of the positive reading, the trend pointed upwards after the steady decline seen in past months. Annual average variation in industrial production swung from minus 0.5% in October to plus 0.3% in November.

FocusEconomics panelists expect industrial production to increase 5.2% 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 6.1%.

Author: Angela Bouzanis, Senior Economist

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India Industry Chart

India Industry November 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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