Govt won’t release May IIP growth data, output slumps 34.7%

MUMBAI: India's industrial production plummeted for the third consecutive month in May as the nationwide lockdown to control the rapid transmission of COVID-19 continued to hit activity.

At (-)34.7%, industrial growth in May based on the Index of Industrial Production was higher than the series low of (-)57.6% in April, according to data released by the National Statistical Office.

This suggests a pick up in industrial activity following relaxation in some lockdown restrictions in lowrisk areas in early May.

In May 2019, industrial growth was 4.5%. The data for May is in line with the consensus estimate.

The statistics office released only index numbers for IIP and refrained from providing growth numbers.

However, while it said last month that it might not be "appropriate" to compare the data for April with previous months as "a number of responding units have reported nil production" in April due to the lockdown, it on Friday said "in view of the circumstances...the indices should not be compared with that of months preceding the COVID pandemic". "...majority of the industrial sector establishments were not operating from the end of March, 2020 onwards.

This has had an impact on the items being produced by the establishments during the period of lockdown and the subsequent periods of conditional relaxations in restrictions.

The Index for the month of May 2020 stands at 88.4 as compared to 53.6 for April 2020, indicating a graded pickup in industrial activity in the economy," the statistics office said.

Interestingly, the statistics office did not release growth numbers for May despite the fact that the weighted response rate was 86%. The weighted response rate for April was revised to 91% from 87%.

In comparison, the final revised IIP numbers for February were computed with a weighted response rate of 92%.

Experts were puzzled by the statistics office's decision against providing the growth numbers upfront, saying they may not do so as the numbers probably did not make for good reading.

The back-to-back massive declines in industrial production have knocked growth down to (-)45.8% for Apr-May as against a growth of 3.9% in the same period last year.