India's factory output grows 1.2% in July

Manufacturing sector, which accounts for more than three-fourth of the entire index, continued to crawl at 0.1 percent growth in July, compared with (-) 0.4 percent in June and 5.3 percent in the same period last year, government showed today.

Capital goods output, which is reflective of the private sector investment scenario, fell (-) 0.1 percent in July compared with 8.8 percent growth last year.

Mining production showed a substantial jump of 4.8 percent in July from 0.4 percent in June, mainly due to a sharp contraction in coal output.

Electricity output continued to grow at 6.5 percent in August, as compared with 2.1 percent year ago.

Infrastructure or construction goods’ grew 3.7 percent in July as compared with a mere 0.9 percent jump last year. Similarly, consumer non-durables jumped 3.4 percent in July from 4.9 percent in June and 14.5 percent growth last year.

In May, the government announced a new series, shifting the base year to 2011-12 from 2004-05, changing the weights and adding new items to reflect current consumption patterns. The change in baseline for the IIP, made by the Central Statistics Office (CSO) last month was much needed, in order to map economic activities more accurately and project realistic data.

In the new series, manufacturing sector’s weightage has been increased to 77.6 percent from 75.5 percent, with electricity's share in the index witnessing a decline to 7.9 percent from 10.3 percent. The data also included renewable energy sources. Infrastructure or construction goods were the new addition in the index, with a substantial rise in the number of consumer durables and non-durables.