India's factory output grew a less-than-anticipated 4.1 per cent year-on-year in February.
This has raised expectations that the Reserve Bank of India (RBI) may soon cut interest rates to pep up the economy. The central bank is set to announce its annual monetary policy for the current fiscal on April 17.
The Finance Minister, Mr Pranab Mukherjee, said industrial growth figures were “disappointing” and attributed this to tight monetary policy and global factors.
“These figures will have a bearing on the monetary policy announcement scheduled for next week. The Government along with the RBI will take required steps to revive activity in the economy,” he told reporters here.
However, this February's industrial growth performance was higher than the revised growth rate of 1.1 per cent in January.
January IIP revised
The Centre on Thursday revised downwards the index for industrial production (IIP) growth rate for January to 1.1 per cent from 6.8 per cent. The revision came in the wake of errors noticed in sugar production data in January.
During the compilation of the index for January, sugar production was wrongly taken as 134.08 lakh tonnes in place of the actual figure of 58.09 lakh tonnes. The error was owing to incorrect reporting by the Directorate of Sugar in the Ministry of Consumer Affairs, Food & Public Distribution, a senior official in the Ministry of Statistics said.
Manufacturing rises
Meanwhile, cumulative factory output growth in April 2011-February 2012 was 3.5 per cent year-on-year.
While manufacturing grew 4 per cent in February, mining output grew 2.1 per cent in the month. There was an 8 per cent growth in electricity generation.
Cumulatively, mining output contracted 2.1 per cent during the April-February period. For the same period, manufacturing grew 3.7 per cent and electricity generation was up 8.7 per cent.
According to use-based classification, basic goods output grew 7.5 per cent, capital goods output was up 10.6 per cent and intermediate goods contracted 0.6 per cent in February year-on-year. While consumer durables contracted 6.7 per cent year-on-year, non-durables grew 5.1 per cent in February.