IIP Numbers: A Positive Sign Of Things To Come

After favourable import-export data Indian stock market has one more reason to cheer as the Index of Industrial Production (IIP) numbers for the month of April 2014 has shown signs of improvement. The general index for the month of April 2014 stands at 172.1, which is 3.4% higher as compared to the level in the month of April 2013. The cumulative growth for the period April-March 2013-14 over the corresponding period of the previous year recorded negative growth of 0.1%.

The indices of Industrial Production for the mining, manufacturing and electricity sectors for the month of April 2014 stands at 122.0, 180.7 and 178.1 respectively, with the corresponding growth rates of 1.2%, 2.6% and 11.9% as compared to April 2013. However, the cumulative growth in these three sectors during April-March 2013-14 over the corresponding period of 2012-13 has been (-) 0.6%, (-) 0.8% and 6.1% respectively. It has been observed that electricity sector has maintained its growth rate in this quarter also.

In terms of industries, 14 out of the 22 industry groups in the manufacturing sector have shown positive growth during the month of April 2014 as compared to the corresponding month of the previous year. The industry group electrical machinery and apparatus has shown the highest positive growth of 66.0%, followed by 9.6% in machinery and equipment and 9.1% in tobacco products. On the other hand, the industry group ‘radio, TV and communication equipments & apparatus, has shown the highest negative growth of  31.6%, followed by  22.1% in wearing apparel; dressing and dyeing of fur and 14.6% in motor vehicles, trailers & semi-trailers.

As per user-based classification, the growth rates in April 2014 over April 2013 are 6.8% in basic goods, 15.7% in capital goods and 4.4% in intermediate goods. The consumer durables and consumer non-durables have recorded negative growth of 7.6% and 3.3% respectively, with the overall growth in consumer goods being negative at 5.1%.

Some of the important items showing high positive growth during the current month over the same month in previous year include cable, rubber insulated (267.1%), copper and copper products (75.4%), ayurvedic medicaments(70.4%), sugar (including sugar cubes), (53.1%), leather garments (45.5%), stainless/ alloy steel (39.4%), cigarettes (31.3%), steel structures (29.1%), scooter and mopeds, (28.0%), terry towels (27.7%) and biaxial oriented polypropylene (BOPP) films (27.2%).