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Current Affairs

IIP growth rises by 4.3% and retail inflation by 3.2%

Date: 13 September 2019 Tags: Economic Planning

Issue

India’s factory output accelerated to 4.3% in July from 1.2% a month ago, while retail inflation increased to 3.21% in August from 3.15% in the previous month.

 

Background

India’s economy reported its weakest growth in more than six years at 5% in the June quarter and slowed for the sixth straight quarter, prompting the government to initiate measures to spur economic activity.

 

Details

  • This is the 13th month in a row for a sub-4% retail inflation figure. The Index of Industrial Production (IIP) grew 6.5% in July 2018.

  • The RBI has projected India’s gross domestic product growth for 2019-20 at 6.9%. Moody’s has pegged GDP growth at 6.4% for the same period.

  • Manufacturing made a strong comeback, growing at 4.2%, while electricity surprisingly decelerated, growing at only 4.8%. 

  • Mining output grew at a robust pace of 4.9% during the month. 

  • Consumer durables also shrank 2.7% due to the slump in automobile sales while consumer non-durables grew at a healthy pace of 8.3%.

  • Food inflation quickened to 2.99% in August from 2.36% a month ago on the back of rising prices of meat and fish, vegetables and pulses.

 

IIP

  • The Index of Industrial Production (IIP) is an index which shows the growth rates in different industry groups of the economy in a stipulated period of time.

  • The IIP index is computed and published by the Central Statistical Organisation (CSO) on a monthly basis.