Industrial Production Contracts 3.6% in February, No Let-Up in Economic Slump
Image Courtesy: The Indian Express
New Delhi: Showing sluggishness in the economy amid the pandemic, industrial production contracted for the second straight month by 3.6% in February due to poor performance of manufacturing and mining sectors, official data showed on Monday.
The manufacturing sector -- which constitutes 77.63% of the index of industrial production (IIP) -- declined by 3.7% in February 2021, as per the data released by the National Statistical Office (NSO).
The mining sector’s output declined by 5.5% in February 2021.
However, power generation grew marginally by 0.1% in the month under review.
The index had grown by 5.2% in February 2020.
Industrial production had plunged 18.7% in March last year following the COVID-19 outbreak and remained in the negative zone till August 2020.
With the resumption of economic activities, factory output posted a rise of 1% in September. The IIP had grown by 4.5% in October. In November 2020, the factory output fell 1.6%, while it again entered the positive territory by growing 1.6% in December 2020.
The IIP data for January 2021 has been revised to 0.9% contraction from a 1.6% decline, as per the provisional data released in March 2021.
The government had imposed a lockdown to contain the spread of COVID-19 infections on March 25, 2020.
With the gradual relaxation of restrictions, there has been a relative improvement in the economic activities by varying degrees as well as in data reporting, the Ministry of Statistics and Programme Implementation had said in a statement issued in November.
The ministry had also given a disclaimer that it may not be appropriate to compare the IIP in the post-pandemic months with the data for the months preceding the COVID-19 outbreak.
The manufacturing sector had recorded a growth of 3.8% in February 2020.
Mining sector output, too, increased by 9.6% in the same month last year. Electricity generation also grew at 11.5% in February 2020.
The output of capital goods, which is a barometer of investment, slipped 4.2% in February 2021, against a contraction of 9.6% a year ago.
Consumer durables output grew by 6.3% in the month under review, compared with a 6.2% decline in February 2020.
Consumer non-durable goods production fell 3.8% the month, compared with a contraction of 0.3% a year ago.
During April-February, the IIP contracted by 11.3% compared with 1% growth in the corresponding period of 2019-20.
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