>> Tuesday, November 11, 2008
India's industrial output probably grew 4.7 percent in September from a year ago, picking up some speed from August's slowest pace in nearly a decade, but analysts said with major economies on the ropes the months ahead would be tough.
The median forecast in a poll of 11 analysts was well above the 1.3 percent annual growth in August but far below July's upwardly revised 7.4 percent and even further behind last year's double-digit rates.
"The momentum of industrial growth has slowed. Manufacturing, especially capital goods, is going to see a drop in output," said N.R. Bhanumurthy, economist at Institute of Economic Growth.
"All the factors -- global slowdown, the rising cost of production and declining domestic demand -- will have an impact on the industrial production numbers." Industrial output rose 6.8 percent in September 2007.
Policy makers are ratcheting down their expectations for growth in Asia's third-largest economy.
Many now say it is likely to slow to 7 percent in the fiscal year to March 2009, sharply slower than the 9 percent expansion clocked up in the past three fiscal years.
In the June quarter, the economy grew 7.9 percent from a year earlier, its slowest rate in 3-½ years.
Reflecting the slowdown, India's manufacturing output expanded at its slowest pace in 14 months in September as domestic demand cooled in the face of seven-year high interest rates, according to the ABN AMRO Bank purchasing managers survey.
The drop in the index (PMI) also showed that a slow down in global demand was starting to bite into exports.
Industrial production, which accounts for about a fifth of gross domestic product and is mostly geared to meet domestic demand, rose 8.1 percent in 2007/08.
September's figure may draw some support from 5.1 percent annual expansion in the infrastructure sector in the month. Infrastructure accounts for nearly a quarter of the country's factory output.
Source: - Reuters.com
IIP data is gona be realised tomorrow