Modi Govt economic score worsens; October industrial output dips 1.9%

Industrial output slipped into the negative territory again with a contraction of 1.9 per cent in October mainly due to sharp decline in production of capital goods and poor performance of manufacturing sector.

After showing decline for two consecutive months of July (-2.5 per cent) and August (-0.7 per cent), factory output, as measured in terms of the Index of Industrial Production (IIP), had grown at 0.7 per cent in September.

For the April-October period, industrial output declined by 0.3 per cent as against a growth of 4.8 per cent a year ago, as per the data released by Central Statistics Office (CSO) today.

Factory output grew at a higher rate of 9.9 per cent in October last year mainly driven by better performance of manufacturing sector and increase in output of capital goods by 16.5 per cent.

The manufacturing sector, which constitutes over 75 per cent of the IIP index, recorded a contraction 2.4 per cent in October. Similarly the capital goods output also shrank by 25.9 per cent.

In terms of industries, 12 out of 22 groups in the manufacturing sector showed negative growth in October.

The mining sector recorded a contraction of 3.1 per cent in October as against a growth of 3.5 per cent a year ago.

Power generation recorded a growth of 1.1 per cent in October compared to 5.3 per cent growth in the same month a year ago. Growth in output of consumer durables went up by just 0.2 per cent in October compared to 41.9 per cent growth a year ago.

The output of consumer non-durable goods declined by 3 per cent in October as against 4.8 per cent growth a year ago.

Overall, consumer goods production dipped 1.6 per cent in October compared to 18.3 per cent growth a year ago. As per ‘use-based’ classification, the growth rates in October 2016 over October 2015 are 4.1 per cent in basic goods, (-) 25.9 per cent in capital goods and 2.9 per cent in intermediate goods.

Meanwhile, the number of inactive companies have dropped by nearly 4,000 in more than three years to 1.38 lakh, Parliament was informed on Friday.

As on October this year, the number of inactive companies was at 1,38,410 as compared to 1,42,373 as on March 31, 2014, Minister of State for Corporate Affairs, Arjun Ram Meghwal said in a written reply to the Lok Sabha.

The number of non-functional companies stood at 1,39,373 and 1,38,691 in 2014-15 and 2015-16, respectively.

Inactive companies are those who were not been carrying out business and haven’t filed financial statements and annual returns during the last two fiscals.

Maharashtra has the maximum number of inactive companies at 33,598, followed by Delhi (28,066), Telangana (17,133), Tamil Nadu (15,352) and Gujarat (10,793).

In 2011, the Ministry had introduced a fast-track exit mode for defunct companies to approach the RoC from time to time for striking off their names, Meghwal said.