- India's industrial output fell to 0.4% in October, the lowest in 14 months
- Manufacturing growth slowed to 1.8% from 5.6% in September
- Mining declined 1.8%, marking a second consecutive monthly contraction
India's industrial output fell sharply in October compared to last year, due to a decline in electricity production and mining.
The Index of Industrial Production (IIP) stood at 0.4% in October, the lowest in 14 months, according to data released by the Ministry of Statistics on Monday. The Bloomberg estimate was 2.5%. In September, the IIP grew 4%.
The slow growth could be attributed to less number of working days because of a number of festivals in the month including Dussehra, Dipawali and Chhath, the Ministry said in a statement.
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Manufacturing growth was 1.8% in October, lower than 5.6% the previous month, with export-oriented sectors hit by higher tariffs. Notable declines were seen in leather, textiles, apparel, chemicals, and pharma.
Bright spots included computers & electronics (9.1%), motor vehicles (5.8%), and basic metals (6.6%), showing continued domestic demand strength.
Mining fell 1.8%, a second consecutive month of contraction.
Electricity output declined 6.9%, after three straight months of expansion. Lower demand in October and consequent decline in electricity generation was driven by extended rainfall season and comfortable ambient temperature across multiple states, the statement added.
IIP Industry Breakup
Primary goods output contracted by 0.6% in October versus a rise of 1.3% in the preceding month.
Capital goods grew by 2.4% versus 5.4% in September.
Intermediate goods grew 0.9% versus a growth of 6.3% in the preceding month.
Infrastructure and construction goods output grew 7.1% versus 10.6% the previous month.
Consumer durables fell 0.5% versus 10% in the previous month.
Consumer non-durables output fell 4.4% versus a fall of 0.3% in the previous month.
The manufacturing PMI survey for November suggest that companies remain wary of the US tariff impact, with a decline noted in business confidence and new export orders, Bank of Baroda economist Aditi Gupta said.
"While there are signs of possible export diversification to other markets, it will take some time to fully scale up and offset the size of the US market. In this regard, successful completion of US-India trade deal would be crucial for a meaningful recovery in India's manufacturing sector," she said.
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