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India's industrial output rose on a sequential as well as on a year-on-year basis in January 2022, official data showed on Friday.

The Index of Industrial Production (IIP) for January 2022 rose by 1.3 per cent from a rise of only 0.7 per cent reported for December 2021. Similarly, the production rate was higher on a year-on-year basis.

In January 2021, the IIP had contracted by 0.6 per cent.

"For the month of January 2022, the 'Quick Estimates of Index of Industrial Production' (IIP) with base 2011-12 stands at 138.4," said the Ministry of Statistics and Programme Implementation.

"The 'Indices of Industrial Production for the Mining, Manufacturing and Electricity' sectors for the month of January 2022 stand at 124.7, 138.1 and 165.6, respectively."

On a YoY basis, the mining excavation output grew by 2.8 per cent from (-) 2.4 per cent in January 2021. The manufacturing production rose by 1.1 per cent from (-) 0.9 per cent, however, electricity generation rose at a slower rate of 0.9 per cent from 5.5 per cent.

Among the major use-based segments, the January data, on a YoY basis, showed that manufacturing of primary goods grew by 1.6 per cent from 0.7 per cent, whereas capital goods production fell by 1.4 per cent from (-) 9 per cent, and intermediate goods increased at a slower rate of 0.9 per cent from 2 per cent.

Similarly, the production of infrastructure or construction goods rose by 5.4 per cent from 2.3 per cent. However, consumer durables' production degrew by 3.3 per cent from a fall of (-) 0.1 per cent and the sub-segment of consumer non-durables rose by 2.1 per cent from (-) 5.4 per cent.

"The industrial sector escaped relatively unscathed from the third wave... While this mild pickup in headline IIP growth admittedly benefitted from the base effect, in MoM terms, industrial output remained unchanged in January 2022 despite the Omicron-related restrictions, with higher mining and electricity output absorbing a muted downtick in manufacturing," said Aditi Nayar, Chief Economist, ICRA.

"Despite the easing of restrictions after the subsiding of the third wave, high frequency indicators point to a mixed trend in February 2022."

Sunil Kumar Sinha, Principal Economist, India Ratings and Research, said: "As the geo-political situation has worsened after the Russia Ukraine conflict and has the potential to turn into a major headwind for the economy, Ind-Ra believes ongoing industrial recovery will need more policy support.

"Against this backdrop, Ind-Ra expects the IIP growth to be in low single digits in the near term, majorly driven by the favourable base effect."