Industrial Production India

Manufacturing slows down industrial production growth in May.

Published monthly by Ministry of Statistics and Programme Implementation(MOSPI). Updated until the month of May 2018. (Published on July 12th, 2018).

Note: The MoM% has been calculated over the seasonally-adjusted series.

Recent Data Trend

India's industrial production growth, as measured by the Index of Industrial Production (IIP), slowed down to a seven month low of 3.2% year-on-year (YoY) in May'17, from a growth of 4.9% YoY in the previous month. The production growth was markedly below the market expectations. (4.4% YoY, Bloomberg Poll). The slowdown was led by weak growth in manufacturing at 2.8% YoY. The electricity generation grew at 4.3% YoY, compared to 8.3% YoY growth in the year-ago period.

The eight core industries output, which constitutes more than 40% of industrial production, had already depicted a slowdown in May slowing down to a 10-month low of 3.6% YoY.

As per use-based classification, the non-durables posted a poor show in May, contracting by 2.6% YoY for the first time since Dec'16. The contraction in non-durable goods production was in contrast to the 9.7% YoY growth in May last year.

Gauging the cumulative performance of industrial production, during Apr-May'18, the industrial production grew by 4% over the corresponding period a year ago. After close to 6% YoY growth in the previous two quarters, the 4% YoY growth would mark a deterioration. It seems the industrial production still seems to be finding its feet amidst supporting the economic growth recovery process.

We believe it is too early to decipher the production performance as of now. We can expect an improvement in the industrial production in Jun'18 as is reflected in the PMI data for June which reflects an expansion in the production activity. The manufacturing PMI rose to its highest level of 53.1 in Jun'17, highest since Dec'17, marking an expansion for the 11th consecutive month.

Brief Overview

Index of Industrial production is published by the Ministry of Statistics and Programme Implementation every month. The current base year of the index is 2011-12=100. The index shows the changes in the production volume of different industrial commodities. The sub-components of IIP are- Mining, Manufacturing, and Electricity. The IIP is also classified according to its use namely, Primary Goods, Capital Goods, and Intermediate Goods. It is an essential measure of growth as it records the level of industrial activity in the economy.

For more information visit the official government website

IIP- Use based classification

Next release date: August 12th, 2018

Industrial Production-Quarterly

Note: The QoQ% has been calculated over the seasonally-adjusted series.

Industrial Production-Annual