CV and component production drops in April-May: IIP

As per the latest data in the Index of Industrial Production (IIP), released today, India’s overall  factory or production output across industries saw marginal growth of 1.7 percent in May 2017 from the 3.1 percent growth in April 2017, due to a slowdown in mining and manufacturing.

IIP is the measure of factory output that helps in measuring economic activity in the country. This May, the government changed the base year from 2004-05 to 2011-12 for giving out much more realistic data.

Overall manufacturing growth has seen a marginal growth of 1.2 percent in May (May 2016: 8.6 percent) compared to 2.6 percent in April, with manufacturing of motor vehicles, trailers and semi-trailers declining by 15.1 percent for May 2017 and the auto components/spares and accessories sectors among others in the highest negative contributors.

However, as per IIP, manufacturing of other transport equipment improved by 11.8 percent in May 2017, and production of two-wheelers improved.

Meanwhile, India’s headline inflation has eased to 1.54 percent in June, the lowest since the index was adopted in 2012, from 2.18 percent in May 2017. Industry will look forward to the Reserve Bank of India to ease its position on providing more liquidity in the market.