Mumbai, Feb 15: Trying to instill confidence in the investor community, Union Minister of State for Commerce and Industry Nirmala Sitharaman Monday said manufacturing in the country is picking up and the perception that there is slack in the sector is wrong.
“Manufacturing is actually picking up. The last quarter figure showed that the country’s GDP growth will be over 7 per cent. It also revealed that manufacturing is growing over 9 per cent. Actually, the perception is going around in the circle without looking at the figures,” she told reporters during the Make in India Week here.
The investment offers and MoUs that have been signed so far in the Make in India week are an indicator that manufacturing is gaining traction, she asserted.
Asked about discrepancies in some of the recently released data and their methodologies to calculate, she said even Kaushik Basu – the World Bank economist and former Chief Economic Advisor – has said “there is absolutely no reason to doubt over the figures which have come out”.
“So, I think in this country there can be a lot of discussions about the methodology, the process of getting the numbers and there is no harm in discussing. But of course, ultimately if there is no doubt after the due discussions, we have to settle somewhere and start believing rather than keep the discussions going on,” she added.
“At the end of the day, you are not able to sit and work on numbers because you question everything.”
Basu had recently said India’s GDP numbers are very dependable and there is no “rigging” taking place with regard to data. He was responding to questions surrounding the GDP numbers being put out by the Central Statistics Office (CSO).
It has projected a growth rate of 7.6 per cent for the current fiscal, the highest in the last five years.
Notably, industrial production declined for the second month, contracting 1.3 per cent in December, mainly due to a drop in manufacturing and capital goods sector.
Factory output as measured by the Index of Industrial Production (IIP) had also declined 3.4 per cent in November.
During April-December this fiscal, the industrial output grew 3.1 per cent compared with 2.6 per cent a year earlier.
The decline in December has been primarily because of a massive slump in output of capital goods, a proxy for investor demand which saw a contraction of 19.7 per cent, as against growth of 6.1 per cent in the same month a year ago.
The manufacturing sector, which accounts for over 75 per cent of the index, fell 2.4 per cent as against a growth of 4.1 per cent in December 2014.