As per the Federation of Indian Chambers of Commerce and Industry (FICCI), the manufacturing sector is expected to get a boost during the fourth quarter of FY13 as some major initiatives taken by the government in the last few months coupled with some budget announcements are likely to improve the prospects for manufacturing in coming months. FICCI, in its survey said that out of 327 units which participated in the study, over 39 percent respondents reported higher order books for fourth quarter of 2012-13 as compared to 33 percent in third quarter of 2012-13.
While, giving mixed signals for upturn in the manufacturing growth, it said ‘some upturn is evident in sectors like textiles, food products, leather and cement. But some major sectors like automotive and capital goods are expected to witness sluggish growth in the current quarter. The number of respondents reporting higher levels of production, in the fourth quarter of 2012-13 has dropped to 36 percent, from over 40 percent in previous few quarters.’
The survey also said that majority of the respondents do not have any plan for capacity addition in next six months as 30 percent of them reported that they are carrying more than their average levels of inventories in sectors like automotive, capital goods and textiles machinery. Over 75 percent said they are not likely to hire new workforce in next three months.
On the exports outlook, FICCI said that the export outlook for manufacturing seems to remain bleak. ‘For the fourth quarter, 40 percent of the respondents expect their export levels to be higher than last year for the same quarter. In the previous survey, we had 54 percent respondents expecting exports to be higher in 3rd quarter against same quarter last year,’ it said.
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