Factory output slows to 4.2% in June as manufacturing drops to seven-month low
- India’s factory output measured by the Index of Industrial Production (IIP), eased to 4.2 per cent in June
Highlights:
- This 4.2 per cent in June is the lowest level since January 2024, mainly due to a slower growth in manufacturing output.
- Manufacturing, which accounts for 77.6 percent of the weight of the IIP, slowed to a seven-month low of 2.6 per cent compared with 5 per cent in May and 3.5 per cent in June 2023.
- The overall industrial output had recorded a growth of 4 per cent in June 2023 and 6.2 per cent in May this year.
- Cumulatively so far in the financial year 2024-25, industrial growth has been recorded at 5.2 per cent during April-June as against 4.7 per cent in the previous financial year.
- Within manufacturing, growth was driven by electronics (after a long hiatus), electrical machinery, metals and the auto sector.
- As per the IIP data, 14 out of the 23 sectors in manufacturing registered growth in June
- On the basis of use-base classification, the capital goods segment, a key indicator of the investment sentiment, showed slower growth of 2.4 per cent in June
- Consumer durables output, an indicator of consumption demand, grew 8.6 per cent mainly coming on the back of the base of (-) 6.8 per cent in June 2023.
- Moderating growth in the manufacturing and electricity sectors offset the acceleration in mining growth weighing on the overall industrial performance.
Prelims Takeaway
- IIP