Industrial slowdown 'accentuated' - CII update

NEW DELHI, DEC. 4. The Confederation of Indian Industry today said the slowdown in industrial production had become more accentuated and this was bound to take its toll on the overall growth prospects of the Indian economy.

"The slowdown in industry is becoming even more ominous. The slowdown is taking its toll on the overall growth prospects of the Indian economy," the chamber said in its "India economic policy update".

Referring to projection made by the reserve bank of India, the chamber said that the Reserve Bank of India has in fact scaled down the projected real GDP growth during 2000-01 to 6-6.5 per cent as against a projected 6.5-7 per cent in April, 2000.

Slowdown in the industrial production is becoming accentuated, it said adding that the industrial growth during the first half of the current fiscal slipped to 5.5 per cent as against 6.4 per cent during the corresponding period last year.

"The manufacturing sector has suffered a major setback with growth sliding from 6.8 per cent during April-September last year to 5.6 per cent during the same period this year," it said.

The CII said this was largely on account of a negative growth of 1.1 per cent in the capital goods sector as well as lower growth of 5.7 per cent in the intermediate goods sector.

Electricity generation was another area of concern where the growth rate slipped from 7.7 per cent during April-September 1999 to 3.4 per cent this year, the chamber said.

The CII said that the growth in the consumer goods was a healthy 7.7 per cent with both consumer durables and consumer non- durables performing well.

The consumer durables sector witnessed an impressive growth of 21.6 per cent during April-September 2000 as compared to 14.1 per cent in the same period last year while the consumer non-durables sector also performed well notching up a growth of 3.4 per cent during April-July 2000.

The chamber said there were some encouraging signals on the fiscal front with both direct and indirect tax collections registering an increase.

The CII said that if the present trend continued through the year the fiscal deficit would be contained at the targeted level.

Total collections of direct taxes up to September stood at Rs. 26,540 crores as against Rs. 18,518 croes in September last year registering an increase of 43.32 per cent, it said adding that indirect taxes also increased to Rs. 55,771 crores up to September 2000 as compared to Rs. 50,530 crores

The CII said its export survey based on responses from 159 exporters indicated that exports during the next six months would continue to grow both in terms of volume and value.

During the next six months 62 per cent of the exporters expect an increase while only eight per cent foresee a decline, it said.

In sectoral terms, 54 per cent of the exporters from the capital goods industry expect exports to increase in value terms while 42 per cent expect the trend to continue and only four per cent expect a decline, it added.

- PTI

Send this article to Friends by E-Mail

Section  : Business
Previous : Bullion rates
Next     : Scrap non-viable projects - IDBI official