Factory output dips in Jan |
Industrial production in India contracted for the third consecutive month in January, dragged down by a sharp decline in manufacturing and capital goods sectors, posing fresh challenges for policy makers against the backdrop of a sluggish global economy. Data released by the Central Statistics Office (CSO) on Friday showed industrial production shrank an annual 1.5% in January compared to 2.8% gr-owth in the year-ago month and a decline of 1.2% in the previous month. The manufacturing sector, which accounts for 76% of the index, fell 2.8% year-on-year in January compared to a growth of 3.4% in the year earlier month.The capital goods sector, which is seen as a gauge of industrial activity, fell 20.4% year-on-year in January compared to an expansion of 12.4% in the same year-ago month. The data on capital goods sector has remained volatile .The unabated contraction in industrial output for the third consecutive month poses concerns, particularly with the one-off factors that impacted production in November and December 2015 having dissipated. Aditi Nayarof ICRA, said existence of this trend may weigh upon the Index of Industrial Production expansion in the remainder of the current fiscal.
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