NEW DELHI: Industrial growth slowed to a three-month low in May, possibly due to adjustments in production ahead of the July 1 roll out of goods and services tax. Destocking and inventory control due to GST impacted more than expectations,” CARE Ratings’ chief economist, Mandan Sabnavis, said. The manufacturing sector, which has the largest weight in the Index of Industrial Production ( IIP ), expanded just 1.2% in May, compared with 2.3% in April and 8.6% a year earlier.Power generation was up 8.7%, while mining output contracted 0.9%. Indranil Pan, the chief economist at IDFC Bank, said he expects the impact of GST to reflect in June data as well. The only bright spark in the numbers was a 7.9% increase in the production of consumer non-durables, or fast moving consumer goods, which suggests some recovery in rural sentiment.

Source: Economic Times July 12, 2017 12:32 UTC