The Reserve Bank of India (RBI) on Wednesday said 2 per cent industrial growth in September was disappointing, but hoped that the economic situation would improve in the second half of the fiscal year (FY14) on the back of good monsoon and exports.
The comment came a day after government data showed India's industrial production growth picked up to 2 per cent year on year in September, from a revised reading of 0.4 per cent in August. (Read more)
"Yesterday's data suggested still weak growth as the IIP numbers came below expectations...the IIP numbers have disappointed a little, partly because of the volatile capital goods sector," RBI Governor Raghuram Rajan said at press meet.
"I am still hopeful that the good monsoon and the associated pick up in consumption, the very healthy exports, and the strong growth in the power sector should lead to stronger growth numbers for the second half of the fiscal year."
The government will release gross domestic product (GDP) growth data for the second quarter later this month.
India's economic growth has slowed to a four-year low of 4.4 per cent due to various global and domestic factors.
Last month, the RBI had lowered its growth projection for the country to 5.5 per cent from the earlier estimate of 5.7 per cent.
Earlier, the RBI said that industrial activity has weakened, with a contraction in consumer durables and tepid growth in capital goods reflecting the ongoing downturn in both consumption and investment demand.
Various external agencies like the IMF and the World Bank have lowered their growth projections for India pegging the economic expansion rate between 4.3-5.9 per cent.
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