March 14, 2022
In December, industrial production had a year-on-year growth of 0.4% compared to 1.4% in November 2021
Compared to pre-pandemic levels of January 2020, industrial production increased by 0.7% in January 2022
Intermediate goods, infrastructure/construction goods, and consumer non-durable segments also witnessed growth
With high crude and commodities prices may prove a deterrent, analysts expect IIP growth to remain in the low single digits
India’s Industrial Production (IIP) grew by 1.3% in January 2022, recovering from a 10-month low in December 2021 as per the Commerce Ministry. In December, the industrial production had a year-on-year growth of 0.4% compared to 1.4% registered in November 2021. Cumulatively, the index grew by approximately 13.7% in April-January 2021 compared to the same period in 2020.
The mining sector accounted for the highest growth at 2.8% in January with the manufacturing and electricity sectors’ output growing by 1.1% and 0.9% year-on-year, respectively.
The data also revealed that while capital goods output and consumer durables segments contracted by 1.4% and 3.3% respectively, the primary goods segment, which accounts for nearly 34% of the index, grew by 1.6% in January. Intermediate goods, infrastructure/construction goods, and consumer non-durable segments also witnessed growth.
Compared to pre-pandemic levels of January 2020, industrial production increased by 0.7% in January 2022. However, the subsequent easing of restrictions has not boosted growth and the momentum has been slower than anticipated due to a weakness in demand and/or supply-side issues. With high crude and commodities prices emerging as a new road bump, analysts expect IIP growth to remain in the low single digits and have called for more support from the government.
