India`s industrial output contracts for first time in 15 years

New Delhi, Dec 12 (PTI) Indian industry recorded negative
growth for the first time in 15 years, falling to 0.4 percent
in October as against 12.2 percent expansion a year ago as
the impact of the global economic downturn deepened in the
country.

The fall is partly due to a dip of over 12 percent in
India's exports.

Policy makers said the fall was bigger than expected even
as they exuded confidence that the December 7 stimulus package
would arrest any further decline. Industrial output had last
fallen in April 1993.

"These figures are more disappointing than what we
expected," Prime Minister's Economic Council Chairman Suresh
Tendulkar said.

Manufacturing, comprising around 80 percent of the Index
of Industrial Production (IIP), clocked a negative 1.2 percent
growth in the month from a whopping 13.8 percent a year ago.

In fact, output in two of the four sectors that make up
the index -- intermediate goods and consumer goods --
contracted to 3.7 percent and 2.3 percent, respectively,
from a growth of 13.9 percent and 13.7 percent, respectively.

Within consumer durable goods, both segments -- consumer
durables and consumer non-durables -- shrank by three percent
and two percent, respectively.

Of the total 17 industries, captured in the IIP figure,
as many as 10 recorded a negative growth and could have a
similar bearing on economic growth, given the fact that
industry accounts for 29.4 percent of GDP.

Commerce Secretary G K Pillai said November too might see
IIP numbers falling further. PTI