Industrial output surges to 5.6% in Feb

India’s industrial output surged to 5.6% in February as against 5.2% in the same period last year, according to the data released by the National Statistical Office. In February last year, the industrial output stood at 1.2%. With this, the mining output stood at 4.6%, whereas the manufacturing output stood at 5.3% in February. Power generation surged to 8.2% during the month under review. In January, the mining output, manufacturing output and electricity growth stood at 8.8%, 3.7% and 12.7%, respectively. 

Between April 2022 to February 2023, the manufacturing output stood at 5.7%, whereas the mining output stood at 4.9%. Power generation during the period under review stood at 10%.

"For the month of February 2023, the Quick Estimates of Index of Industrial Production (IIP) with base 2011-12 stands at 138.7. The Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month of February 2023 stand at 129.0, 136.8 and 174.0 respectively. These Quick Estimates will undergo revision in subsequent releases as per the revision policy of IIP," the government said in a statement.

 As per use-based classification, the indices stand at 139.7 for primary goods, 104.4 for capital goods, 143.2 for intermediate goods and 164.0 for infrastructure/ construction goods for the month of February 2023. Further, the indices for consumer durables and consumer non-durables stand at 108.4 and 154.3 respectively for February 2023.

Meanwhile, the retail inflation based on the consumer price index fell to 5.66% in March, which is a 15-month low, as against 6.44% in February owing to a decline in food prices. In March last year, retail inflation stood at 6.95%.  Retail inflation in rural areas stood at 5.89% whereas in urban areas it was 5.51% for the month under review. In February, the rural and urban inflation stood at 6.72% and 6.10%, respectively. In March last year, the rural and urban inflation stood at 7.66% and 6.12%, respectively.

The retail inflation of March is within RBI’s target limit of 6%. RBI paused the repo rate hike at 6.5%  in its April Monetary Policy Committee meeting. RBI Governor Shaktikanta  Das said that the MPC also decided to remain focused on the withdrawal of accommodation to ensure that inflation progressively aligns with the target while supporting growth. The MPC had hiked the repo rate six consecutive times before the April review meeting.

The MPC's pause on the rate hike comes nearly two months after the RBI governor said that pausing the repo rate hike would be 'premature'. To control rising inflation, RBI's MPC hiked the repo rate by 25 basis points to 6.5% in February.