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'Industry growth seen consolidating at around 5 pc in FY'14'

In the wake of volatile IIP growth performance over the past many months, the recent months rebound in IIP growth is inspiring, said Suman Jyoti Khaitan, President, PHD Chamber of Commerce and Industry.

IIP grew in the positive trajectory for the past four months in a row at 2 percent in April 2013, 2.5 percent in March 2013, 0.6 percent in February 2013 and 2.4 percent in January 2013.

The cumulative growth for the period April-March 2012-13 stands at 1.1 percent compared to 2.9 percent in 2011-12.

Going ahead, we anticipate the industry growth consolidating at around 5 percent in the current financial year 2013-14 supported by reviving demand conditions vis-à-vis softening monetary policy stance and a low base effect, said Khaitan.

There are a host of reforms, which if implemented could make the industry environment conducive for investments and help attain higher growth trajectory, going forward, he added.

Driven by reasonable growth in the production of consumer non-durables (12.3 percent), consumer goods (2.8 percent), manufacturing (2.8 percent) and intermediate goods (2.4 percent), the IIP for the month of April 2013 grew in the positive trajectory.

The basic goods grew at 1.3 percent, capital goods at 1 percent and electricity generation at 0.7 percent in April 2013.

The overall economic situation is also expected to improve in the ensuing months on moderating inflationary expectations and easing monetary conditions ahead, in our view, said Khaitan.

Softening inflation and interest rates scenario will facilitate rapid expansion in the industry situation, bringing it back on the steady growth track, he said.

Going ahead, the chamber is looking forward to measures that would help harness the country’s potential and put the economy on the path of sustainable growth, Khaitan added.