IIP fluctuation not to hit over 8.5 pc GDP projection: Montek

Posted By: Pti
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New Delhi, Feb 11 (PTI) Sticking to its projection ofover 8.5 per cent GDP growth this fiscal, the PlanningCommission today said monthly variations in industrial outputnumbers should not be a cause of concern.

Growth in industrial output, as measured by the index ofindustrial production (IIP), slowed to 1.6 per cent inDecember, 2010, the lowest pace of expansion in the last 20months.

"Month-to-month variation in IIP should not occupy us toomuch," Planning Commission Deputy Chairman Montek SinghAhluwalia told reporters on the sidelines of an Indo-USEconomic summit.

He said, "This high frequency IIP data is not necessarilyan indication of an underlying trend."

IIP expansion declined to 1.6 per cent in December, 2010,from 18 per cent in the same month of the previous year. Thegrowth was also low at 2.7 per cent in November.

However, industrial output grew in double digits inApril, May, July and October, 2010.

"In the current year, the Planning Commission has saidthat GDP will grow at 8.5 per cent or maybe a little higher.

That prediction remains," Ahluwalia added.

Asked about the impact of a slowdown in industrial growthon economic expansion this fiscal, he said, "In order toachieve 8.5 GDP growth, 8 per cent industrial growth for thewhole year (2010-11) is enough."

Despite low growth in two consecutive months, industrialproduction expansion during the April-December, 2010, periodstood at 8.6 per cent.

The government has estimated economic growth for thecurrent financial year at 8.6 per cent, as against 8 per centa year ago.

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