India's factory output in October rose by a similar pace as seen in September, led by growth in mining and manufacturing of primary goods.
The Index of Industrial Production rose 3.2% over a year earlier compared with an increase of 3.3% in September, as per revised estimates. On a month-on-month basis, the index rose 4.3% in October against a fall of 2.4% in September, as per revised estimates.
29 economists polled by Bloomberg had forecast October IIP growth at 3.7%.
Industrial growth was stable but tepid in October, with the festive season boost being negated by the supply side issues afflicting the auto sector, as well as a higher base, Aditi Nayar, chief economist at ICRA said.
Devendra Pant, chief economist at India Ratings & Research also said that IIP growth has been very fragile and even festive demand was not able to uplift it in October.
Overall industrial output is still below pre-Covid levels, 99.6% of February 2020.Devendra Pant, Chief Economist, India Ratings & Research
Omicron could be a disruptor in coming months, said Pant, adding that a weak set of IIP numbers could be expected even for the rest of FY22.
Sectoral Estimates
Mining output rose 11.4% in October over a year ago. It rose by 15.4% on a monthly basis.
Manufacturing output rose 2% in October over last year. Month-on-month it rose by 3.4%.
Electricity generation rose 3.1% from an year ago. On a monthly basis, it declined by 0.4%.
Industrial output, as classified by the end-use of goods, showed a decline in some industries while others advanced.
The disaggregated data does not provide convincing signals of the recovery becoming durable and broad-basing further, with capital goods and consumer durables reporting a contraction on an annual basis, Nayar said.
Primary goods output rose 9% year-on-year in October and 9.5% over a month ago.
Capital goods output declined by 1.1% annually and by 2.4% compared to the previous month.
Intermediate goods output rose by 2.1% annually. On a monthly basis it rose 2.4%.
Infrastructure and construction goods output rose 5.3% over last year in October. It was 6.4% higher than the previous month.
Consumer durables output was 6.1% lower than a year ago. It fell 0.7% over a month ago.
Consumer non-durables output was 0.5% higher than a year ago. It rose 1.2% over September.
A contraction of 6.1% for consumer durable and 0.5% growth in consumer non-durable are testimony of weak demand conditions in the economy, Pant said.
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