CII survey : Inflation, input cost hampers manufacturing growth

By SiliconIndia   |   Monday, 29 November 2010, 13:10 Hrs
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The growth of manufacturing sector has been inhibited by high inflation and input cost, even though the segment,contributing over 80 percent in industrial output contributing over 80 percent in industrial output.

There are sectors which have recovered sharply and grow at over 20 percent while some have remained in the moderate growth range of 0-10 percent during April-September, 2010-11, over the same period last year, it said.

"Soaring inflation, rising input cost and slow growth in capacity addition are some of the reasons that are inhibiting growth in specific sectors," CII Director-General Chandrajit Banerjee said.

Out of 127 sectors covered by the survey, 43 sectors, including aluminium, natural gas and vehicle industry have registered an excellent growth rate of more than 20 percent in April-September, 2010.

Sectors registering high growth rate, however, have decreased from 30 last year to 22 sectors in the first half of the fiscal.

Sectors reporting high growth rate include, crude oil, power cables and consumer non-durables like cigarettes and home and personal care.

The survey further said sectors recording moderate growth of 0-10 percent during the period include, cement, edible oils, fertilizer, and electricity. Inflation was 8.58 percent in October against 8.62 percent in the previous month.

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