India`s March industrial output zooms on low base effect
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The low base effect from last year's nationwide lockdown powered the growth of India's industrial output in March.
The Index of Industrial Production (IIP) for March accelerated by 22.4 per cent over the same month a year ago and a contraction of 3.4 per cent reported for February.
On a fiscal basis, the IIP contracted by (-) 8.6 per cent in FY21 from (-) 0.8 per cent during the April-March period of the previous financial year.
"For the month of March 2021, the Quick Estimates of IIP with base 2011-12 stands at 143.4," the Ministry of Statistics and Programme Implementation said.
"The Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month of March 2021 stand at 139, 140.4 and 180, respectively."
Among the major segments, manufacturing production rose by 25.8 per cent from a fall of (-) 22.8 per cent reported for the corresponding month of 2020.
Similarly, mining output grew 6.1 per cent on a YoY basis from (-) 1.3 per cent during the like period of the previous year.
Besides, electricity generation climbed up by 22.5 per cent from a fall of (-) 8.2 per cent during March 2020.
Furthermore, the data on a YoY basis showed that manufacturing of primary goods grew by 7.7 per cent, while capital goods production rose by 41.9 per cent, and that of intermediate goods climbed by 21.2 per cent.
Similarly, the production of infrastructure or construction goods rose by 31.2 per cent, while consumer durables' production grew by 54.9 per cent.
The sub-segment of consumer non-durables showed a growth of 27.5 per cent.
"The low base related to the onset of the nationwide lockdown in March 2020 powered the IIP growth to a high 22.4 per cent in March 2021, led by manufacturing and electricity," said ICRA's Chief Economist Aditi Nayar.
"Given the low base of the lockdown, we believe it's more meaningful to compare the industrial performance in March 2021 with March 2019, which reveals a mild albeit sobering contraction of 0.5 per cent."
India Ratings and Research's Principal Economist Sunil Kumar Sinha said: "Factory output in March 2021 shows a YoY growth of 22.4 per cent which is highest in the current series with 2011-12 base."
"These growth numbers have been calculated on a production base of March 2020, which had witnessed nearly 1/3rd less working days due to the country-wide lockdown."
