New Delhi, July 12: As low base effect starts wearing out, India’s industrial production in May grew by less-than-expected 11.5 per cent. This is the slowest growth in the industrial production in the last seven months.
“Nobody should expect that the industrial manufacturing sector will continue to grow at abnormally high number for a long time to come. There are capacity constraints,” said finance secretary, Mr Ashok Chawla.
The secretary said that the manufacturing sector would continue to see average growth trend now and should grow in double digits in the current financial year.
“Whatever output lag was there in the economy has been filled and the manufacturing sector is now showing the kind of average secular growth which continues to be good and would be favourable for the economy,” Mr Chawla added.
Citi India, economist, Ms Rohini Malkani, said that while numbers are lower than expected, there is no need for undue concern as data trends both at the macro (loan growth, non-oil imports) and sectoral front (auto, cement, diesel consumption) are healthy. “We were expecting the nu-mbers to moderate from June due to a fading base effect, but May data indica-tes that the moderation has already begun,” she said.