India's industrial output grows 10.4 per cent in August (Roundup)

Oct 12, 2009, 10:44 GMT

   New Delhi - India's industrial production rose 10.4 per cent in August, a 22-month-high, buoyed by double-digit growth in the mining, manufacturing and electricity sectors, in a surer indication of the country's economic recovery.

   The year-on-year growth represented a significant increase from the 6.4-per-cent rate recorded in the same month a year ago, data released by the state-run Central Statistical Organization showed.

   The impact of government stimulus measures was evident as manufacturing grew 10.2 per cent and the electricity sector grew by 10.6 per cent in August, the organization said. The mining sector clocked growth of 12.9 per cent.

   The spurt in industrial output was the largest the country has seen in the past 22 months, the NDTV network reported.

   India's industrial growth stood at 5.8 per cent in the first five months of India's financial year, which began April 1, compared with 4.3 per cent during the same period last year.

   Shortly after the data was released, Finance Minister Pranab Mukherjee said the figures showed that the recovery process was underway.

   'It is a good sign and it is a recovery, a process of recovery,' Mukherjee told reporters in New Delhi.

   Prime Minister Manmohan Singh said Sunday that the worst was over for the Indian economy, which was making a slow but steady recovery. He said measures that were taken to control inflation were having an effect.

   'The worst is indeed over,' Singh said. 'The price rise has been due to the drought. Steps are being taken. I am confident the harvest will be normal.'

   Economists have said that the industrial upsurge may make up for likely decline in farm production, hit by the drought due to a weak monsoon season.

   The Indian economy, Asia's third-largest, recorded 6.1-per-cent growth during the first quarter of the financial year despite the global economic crisis. It is likely to grow up to 6.5 per cent for the entire fiscal year, government officials predicted.