LD IIP 2 LST

In terms of industries, 12 out of 17 industry groups
achieved positive growth in the last month of 2010.
The data also revealed that consumer non-durables
production contracted by 1.1 per cent in December.
Industry chamber Federation of Indian Chambers of
Commerce and Industry (FICCI), said the large base effect may
have been one of the causes for sharp slowdown of the
manufacturing sector.
Besides, rising interest rates on tight monetary policy
and partial exit from the stimulus could be responsible for
the declining trend.
"We add a cautionary note on further tightening of
monetary policy and exit from the stimulus," chamber
President Rajan Bharti Mittal said.
Ahead of the Union Budget, it is apprehended by the
industry that the Finance Minister may roll back some of the
stimulus measures which were announced in 2008 and 2009 during
the global financial crisis.
Assocham felt that high inflation could have impacted the
industrial growth.
"Indian industry has been facing hyper inflation
conditions for over a year," Assocham President Dilip Modi
said suggesting restoration of of some of fiscal stimulus
incentives which were withdrawn in 2010-11.
Research firm ICRA (Internet Content Rating Agency) said
a continuing high base effect is likely to keep IIP growth low
over the coming few months.
ICRA's economist Aditi Nayar, however expects that like
November, the Decembers' IIP too would be revised upwards. PTI
JD
DBR


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