In September, there was an increase in factory production after a gap of six months. This increase came due to the demand of festival season.
Due to the increase in production of basic metals, pharmaceuticals and petrochemical sector, the manufacturing sector in the country has started showing momentum.
Due to these sectors, in 2020 industrial production index ie IIP reached the positive zone. Whereas IIP had fallen by 1.9 per cent in November. In September and October (2020), industrial production was recorded after a decline of six consecutive months.
Heavy drop in mining
According to data from NSO, the index IIP of December (2020) increased by 1 percent in December. Whereas in November, its growth was -1.9 percent. Manufacturing output growth was 1.6 percent, while mining production declined and it was -4.8 percent. Capital goods gained only 0.6 percent, while consumer durables recorded a gain of 4.6 percent.
IIP increased by just three months in the current financial year
So far in the current financial year, industrial activity has registered an increase in just three months. In September, there was an increase in factory production after a gap of six months.
This increase came due to the demand of festival season. The manufacturing sector was believed to have moved out of the impact of Covid-19, but it again declined in November and it turned negative. However, it increased marginally in December (2020) and registered a growth of one per cent.
IIP is not showing any hope of fast growth
Analysts believe that there was no complete recovery in industrial activity. Actually, the increase in IIP seen in September and October was due to the increased demand in the festival season.
Nidhi Malviya is fun loving girl. She writes at NoobFeeds about various topics related to Finance, Technology, Business etc.