India’s March industrial output growth slows to 4.1% on weaker electricity generation

India’s industrial output growth eased to 4.1% year-on-year in March, down from 5.2% in February, mainly due to a slowdown in electricity generation, according to official data released on Tuesday.

The Quick Estimate of the Index of Industrial Production (IIP), released by the Ministry of Statistics and Programme Implementation, showed that manufacturing grew 4.3% in March, while mining output rose 5.5%.

Electricity generation, however, expanded just 0.8% during the month, dragging the overall print lower.

In absolute terms, the IIP stood at 173.2 in March, up from 166.3 a year earlier.

The indices for mining, manufacturing and electricity sectors were recorded at 166.8, 169.4 and 221.3, respectively.

Within manufacturing, 14 of 23 industry groups posted growth, led by basic metals, motor vehicles and machinery.

Output of motor vehicles, trailers and semi-trailers surged 18.1%, while basic metals grew 8.6% and machinery and equipment rose 11.2%, indicating continued strength in investment-linked and core sectors.

In the automobile segment, auto components, commercial vehicles and axles drove the growth, while machinery output was aided by equipment such as material handling systems, agricultural tractors and industrial engines.

The data showed that infrastructure and construction goods, capital goods and primary goods were the top contributors to overall IIP growth in March.

Use-based data pointed to robust capital expenditure trends, with capital goods output jumping 14.6% on-year.

Infrastructure and construction goods grew 6.7%, while intermediate goods rose 3.3%.

Consumer durables output increased 5.3%, while non-durables – a proxy for everyday consumption – edged up just 1.1%.

Primary goods production rose 2.2% during the month.

The IIP data are provisional and subject to revision as more information becomes available to the government.

The industrial output data for April is scheduled to be released on June 1.