Concerned over the fall in industrial output, the Commerce and Industry Minister Anand Sharma will hold consultations with India Inc next week to seek suggestions on possible remedial measures.
Official data released on Thursday showed that the industrial production shrunk 1.8 per cent in June, against the robust 9.5 per cent growth in June last year. This is the third time in four months that the factory output has shrunk.
The industrial output during April-June 2012 also declined -- by 0.1 per cent -- against 6.9 per cent growth in the same quarter last year.
An official statement on Friday said that Sharma, who was regularly reviewing the situation with senior officials, will first meet the industry chambers such as FICCI and CII along with the apex body for exporters, the Federation of Indian Export Organisations (FIEO).
He would then convene a meeting of the Government-Industry Task Force to get inputs for policy measures that can be taken by the Government soon to boost factory output and exports. The Task Force was set up in July last year.
Sharma had on Thursday met the Finance Minister P Chidambaram to discuss the fall in exports, industrial output and other important aspects of the economy.
Terming the fall in industrial production as ‘disappointing’, Chidambaram had said in a statement that it was important to focus on the critical sectors, remove bottlenecks and give a fillip to production. He said the production will revive if there are new investments in the demand creating industries.
He said the contraction in factory output was due to decline in the manufacturing sector (-3.2 per cent in June and -0.7 per cent in the April-June quarter), adding that within the manufacturing sector, capital goods declined -27.9 per cent in June, while consumer non-durables declined -1 per cent in the month.
Meanwhile, Sharma said he hopes that the growth in the country’s exports would revive by autumn due to the measures taken by the Government.
Merchandise exports in June had shrunk 5.45 per cent year-on-year to $25.06 billion. The fall -- the third time in four months since March -- was largely due to the continuing weak demand in traditional markets such as Europe and the US as well as the deceleration in domestic manufacturing.