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India’s IIP contracts by 16.7% in March amid Covid-19 pandemic

13 May 2020 Evaluate

India's industrial output, measured in Index of Industrial Production (IIP), contracted by 16.7% in March 2020 mainly on account of poor show by mining, manufacturing and electricity sector due to the nationwide lockdown. The IIP had grown by 2.7% in March 2019. The IIP in the last fiscal contracted by 0.7% from 3.8% expansion in the 2018-19. The government had imposed lockdown to contain Covid-19 from March 25, 2020. As per the data released by the National Statistics Office of the Ministry of Statistics and Programme Implementation, IIP with base 2011-12 for the month of March 2020 stood at 120.1.

On the sectoral front, manufacturing sector output fell by 20.6% compared to a growth of 3.1% in the same month a year ago. Electricity generation declined by 6.8% as against a growth of 2.2% in March 2019. Mining sector output remained flat compared to a growth of 0.8% earlier. The Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month of March 2020 stand at 132.7, 114.8 and 149.2, respectively.

Besides, production of capital goods, a measure of investment, remained in negative with contraction of 35.6% in March over contraction of 9.1% in the corresponding month of last year. As per Use-based classification, the growth rates in March 2020 over March 2019 are -3.1% in Primary goods, -18.5% in Intermediate goods and -23.8% in Infrastructure/ Construction Goods. The growth in consumer durables and consumer non-durables was -33.1% and -16.2%, respectively.

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