Industry surges over 16% in Dec; rekindles debate on stimulus

New Delhi, Feb 12 (PTI) India's industrial growth zoomed
to 16.8 per cent in December 2009, giving hope to the
government that overall economic growth may be faster and
rekindling a debate on withdrawal of stimulus packages in the
Union Budget.

The Index of Industrial Production (IIP), which measures
industrial growth, had contracted by 0.2 per cent in the same
month a year ago and hence made the industrial recovery look
comparatively higher.
The growth in the factory output was mainly led by the
manufacturing sector, which constitutes around 80 per cent of
IIP, as it rose by 18.5 per cent against 0.6 per cent slide a
year earlier.
Within manufacturing, the consumer durables industry like
auto, refrigerators, etc surged 46 per cent against 4.2 per
cent fall in December 2008. Capital goods output also rose by
38.8 per cent, clearly showing that industry would sustain
high growth rate in future as well.
This has raised the expectations of the Government that
is now talking of better economic growth numbers than 7.2
projected by the Central Statistical Organisation earlier this
week.
"It (IIP growth rate in December) is quite encouraging
and I do hope that third quarter GDP figures will also be
encouraging...it will get reflected in the overall GDP",
Finance Minister Pranab Mukherjee told reporters here.
However, the strong IIP numbers have sharply divided
analysts and chambers whether stimulus provided to spur the
industry facing the brunt of global financial crisis should
now go. PTI KKS
RBT


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