Industrial production in the country registered a negative growth of 1.5 per cent in January as output contracted for the third straight month due mainly to a negative growth (- 2.8 per cent) of manufacturing during the month.
Cumulative growth for the period April-January 2015-16 stood at 2.7 per cent compared to the corresponding period of the previous year.
Manufacturing output, which accounts for over 75 per cent of the index, declined by 2.8 per cent against a growth of 3.4 per cent in January 2015 while capital goods production fell by a whopping 20.4 per cent during January 2016.
India Inc attributes the decline in growth to delay in the recovery of manufacturing, which, according to them, can be addressed only through further improvements in the ease of doing business, including a reduction in lending rate.
"The delay in the recovery of manufacturing is going to impact the overall economic growth. There is a need for addressing the issue of ease of doing business in a comprehensive manner that would pull the investments into manufacturing," Ficci secretary general A Didar Singh said.
Production in the mining sector grew at 1.2 per cent in January 2016 while manufacturing output fell 2.8 per cent year-on-year. Electricity generation, however, recorded a growth of 6.6 per cent during the month.
The three sectors recorded cumulative growth rates of 2.1 per cent, 2.5 per cent and 4.7 per cent, respectively, during April-January 2015-16 compared to the corresponding period of 2014-15.
Ten out of the 22 industry groups in the manufacturing sector have shown negative growth year-on-year during January 2016.
The industry group 'electrical machinery and apparatus' has shown the highest negative growth of (-) 50.3 per cent, followed by 'publishing, printing and reproduction of recorded media' (-) 12.7 per cent and 'medical, precision and optical instruments, watches and clocks' (-) 11.5 per cent.
On the other hand, the industry group 'office, accounting and computing machinery' has shown the highest positive growth of 41.0 per cent, followed by 'radio, TV and communication equipment and apparatus' 22.4 per cent and 'furniture and manufacturing' 16.3 percent.
Basic goods production registered a decline of 1.8 per cent while capital goods production fell 20.4 per cent and production of intermediate goods was down 2.7 per cent in January 2016.
Production of consumer durables and consumer non-durables recorded growth rates of 5.8 per cent and (-) 3.1 per cent, respectively, with the overall growth in consumer goods being 0.0 per cent.