While Planning Commission Deputy Chairman Montek Singh Ahluwalia described the Index of Industrial Production (IIP) numbers for June as "disappointing", industry chambers and other experts demanded immediate policy action to prevent further decline.
The declining factory output will increase pressure on Finance Minister P Chidambaram to quickly move ahead with the initiatives announced by him last week to boost investments to retrieve the situation.
As per the official data released today, the IIP growth in June declined by 1.8 per cent from a healthy growth rate of 9.5 per cent in the corresponding period last year.
During the April-June of the current fiscal, IIP growth works out to be -0.1 per cent, as compared to a growth rate of 6.9 per cent in the same period last fiscal.
The decline in industrial output has been mainly on account of poor performance of the capital goods sector which reported a negative growth of 27.9 per cent in June. The manufacturing sector growth too contracted by 3.2 per cent during the month.
"The industrial numbers have been disappointing for the first few months...I do not see robust industrial growth in the current fiscal," Ahluwalia said.
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However, he hoped that initiatives announced by Chidambaram last week should help in boosting economy, more so in the second half of the financial year.
Industry chambers too expressed disappointment and called for immediate policy actions to arrest further decline in output. (MORE)