India’s factory output slows to 4.8% in January

India’s industrial output growth slowed to 4.8 percent in January compared to 7.8 percent in December. The country’s factory output index stood at 169.4 during the month compared to 161.6 in the year-ago period.

Growth in the Index of Industrial Production (IIP) was supported by a 4.8 percent increase in the manufacturing sector and a 5.1 percent rise in the electricity sector, according to data released by the Ministry of Statistics & Programme Implementation.

Fourteen of the 23 industry groups in the manufacturing sector recorded positive growth during the month. Manufacturing accounts for the bulk of the index.

The top three positive contributors for January were manufacturers of basic metals (13.2 percent), motor vehicles, trailers and semi-trailers (10.9 percent), and other non-metallic mineral products (9.9 percent).

The 13.2 percent growth in basic metals was driven by higher output of alloy steel flat products, mild steel slabs, and hot-rolled coils and sheets.

Under use-based classification, primary goods growth slowed to 3.1 percent from 4.4 percent, while capital goods growth eased to 4.3 percent from 8.1 percent, indicating softer investment momentum.

Consumer durables growth moderated to 6.7 percent from 12.3 percent, while consumer non-durables contracted 2.7 percent against an 8.3 percent expansion earlier.

The IIP measures changes in the volume of production of industrial products and is used by policymakers and investors to assess economic trends and guide policy and investment decisions.