New Delhi: Industrial output in India expanded for the second consecutive month in a row due to a low base effect owing to COVID-19 induced lockdown that hit economic activity last year.
As per the data released by the government, India’s industrial production (IIP) surges to 134.4% in April 2021, heavily influenced by the base period, which saw a strict national lockdown and consequent standstill of economic activities. For the same month last year, IIP had contracted 55.5%
According to the Ministry of Statistics and Programme Implementation, manufacturing sector production, which accounts for more than three-fourths of the entire index, registered a growth of 197.1%, while the output of electricity generation sectors grew 38.1%.
Similarly, mining activity saw 37% growth.
“Industrial production super-surged in April, growing 134% amid favorable base effects despite weakening momentum. On a sequential basis, April IIP degrew 12%, reflecting a hit on production activity as major states like Maharashtra and Delhi led the localized lockdowns,” Madhavi Arora, Lead Economist, Emkay Global Financial Services said.
She further said that May IIP sequential growth may also be impacted owing to more pronounced localised lockdowns state wise.
Commenting on the outlook she said “Assuming Q1FY22 sees the maximum Covid-II heat and as a larger proportion of the population are vaccinated, some pent-up demand could push manufacturing and overall GDP growth back up in H2FY22. We see FY22 GDP growth at 9.0%.”