India Inc hails green shoots of economic recovery

New Delhi, June 12: In a development that pleased India Inc official data on factory output for April showed sharp rise of 4.1 percent, from 2.1 percent reported for the previous month.

India's retail inflation inched up to 5.01 percent in May after having fallen to 4.8 percent in April, official data showed on Friday.

Terming the April 2015 figures encouraging, industry body Assocham said it is pleased to finally see the green shoots of economic activity getting converted into growth figures for the industry.

"IIP numbers seem to be healthy and encouraging and seem to provide stem to the underlying growth momentum as the industrial activity is showing signs of revival as indicated by the 4.1 percent growth seen in April 2015 over the corresponding month of 2014," said Rana Kapoor, president of The Associated Chambers of Commerce and Industry of India.

"The manufacturing sector seems to have recorded a better growth rate of 5.1 percent as compared to the 3.0 percent seen in April 2014," he added.

Surprising industry expectations, an uptick in manufacturing pushed up India's factory output to 4.1 percent in April, against 2.1 percent in the month before.

According to the Central Statistics Office (CSO) which released the data on the Index of Industrial Production (IIP), the healthy growth in the factory output for April was attributed to an uptick in the manufacturing sector.

The manufacturing sector, which has the maximum weightage in the IIP, grew by 5.1 percent in the month under review from 2.2 percent in March.

"The turnaround in the manufacturing stands out as the growth in manufacturing sector also augurs well in terms of generation of employment opportunities," Assocham said.

Further, among the six sectoral indices, capital goods expanded by 11.1 percent.

"The manufacturing growth seems to be gaining momentum now as is evident from the healthy growth of key sectors like capital goods and also from the fact that growth is more diversified," said Jyotsna Suri, president of industry chamber FICCI.

"The government has taken several steps in the last few months to improve the business environment and enhance the investor confidence which is now going to yield results," she added.

IANS