India’s industrial output growth rose a paltry 0.1% in April as the mining sector declined while the manufacturing sector remained sluggish, piling more pressure on the government to take measures to revive the key sector. Data released by the Central Statistics Office showed industrial output in April remained flat, rising 0.1% compared with 5.3% growth a year earlier. The CSO revised the March data to a decline of 3.2% from the previously reported fall of 3.5%.
The sluggish data and the warning from S&P fuelled expectation that the RBI may cut interest rates when it reviews policy on June 18. The industrial sector has been under huge stress due to a series of factors including high interest rates, input costs, slowing investments and delay in policy implementation. Tuesday's data showed the manufacturing sector continues to remain under severe stress, rising 0.1% compared with growth of 5.7% in April 2011 while the mining sector fell 3.1% compared to growth of 1.6% in the same year-ago month.
The capital goods sector, a barometer of economic activity, fell 16.3% in April compared to growth of 6.6% in April 2011 while the intermediate sector fell 1.4% from 3.9% growth an year earlier.
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