India’s factory output growth, as measured by the Index of Industrial Production (IIP), surged by 7.1 per cent in April 2022 on the back of growth in capital goods and consumer durables sector.

Capital goods sector surged by 14.7 per cent in April, while the consumer durables sector rose by 8.5 per cent compared to the figures recorded during the same period last year.

The tepid growth in non-durables sector remains a cause for concern. It remained almost flat at 0.3 per cent, showing that consumers are wary to spend amid high inflation.

National Statistical Office further said that primary goods, intermediate goods, infrastructure and construction goods and consumer non-durables sectors expanded by 10.1, 7.6, 3.8 and 0.3 per cent, respectively.

The manufacturing sector reported growth of 6.8 per cent, while electricity and mining showed an increase of 11.8 and 7.8 per cent respectively.

India’s economy entered FY23 with a host of macroeconomic challenges. Inflation risks and tightening interest rates are likely to slow down the economy as the RBI and the government act to tame rising prices.