Industrial output at 2-month high

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The industry output has climbed to a two month high of 4.1 per cent in April driven by manufacturing, but retail inflation too went few notches up in May amid worries over deficient monsoon.

As per the data released by the government, factory production measured on Index of Industrial Production (IIP) grew by 4.1 per cent in April as against 3.7 per cent in the year ago period and 2.5 per cent compared with the preceding month.

Manufacturing output, which constitutes over 75 per cent of the index, grew at higher rate of 5.1 per cent in April as against 3 per cent in the same month last year.

The production of capital goods, a barometer of demand, however, grew at a slower pace of 11.1 per cent in April as against 13.4 per cent in the same month last year.

Speaking to the media today, Union Finance Minister Arun Jaitley said that the economy was now recovering from the serious challenges it had faced in the last few years.

“The economy is recovering from the serious challenges it has faced in last few years, basic fiscal data looks good. Retail credit has picked up, corporate credit is still to pick up,” Jaitley said at a press conference in New Delhi.

The Finance Minister also met the heads of PSU banks today and discussed the state of banks with respect to the current economic scenario.

“We discussed the state of banks with respect to the state of the economy. Social sector schemes were also discussed. The government will seriously look into bank re-capitalisation over the next few months. We expect the banks to pass on RBI rate cuts in the coming months,” he added.

According to latest World Bank figures, India may officially surpass China in its growth rate as it is now leading major emerging economies in the growth chart.

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