Business Cycle Indicator moderates to 5.1% in March: Zyfin

Industrial activity in India moderated in March mainly due to the onset of the election code of conduct for general elections in the country, as per the report by global financial firm Zyfin Research. The Business Cycle Indicator (BCI) - an index to gauge the Index of Industrial Production (IIP) expanded by 5.1% in March compared to 5.4% a month ago, indicating a marginal decline in industrial activity.

However, the research firm expects that it is a temporary deviation and industrial activity will pickup in the coming months. In February, the industrial output showed a virtual halt in growth as it expanded by a mere 0.1%. India’s annual industrial output growth grew marginally at 0.1% in January as compared to -0.6% in December and 2.5% in the same month previous year. Further, cumulative growth for the period April-January 2013-14 over the corresponding period of the previous year stood flat.   

Referring to economic growth, the ZyFin Research highlighted that a sustained and speedy recovery in economic activity remains difficult unless the economy experiences an adequate demand push. Further it added that spending activity has still been remaining sluggish and any major recovery in consumer spending is unlikely for the next six months. At present, Indian economy is struggling with slowdown and its growth slowed down to a decade low at 4.5 percent in FY13 and 4.6 percent during the first three quarter of FY14.