India saw its industrial production decline for the first time in nearly two years last August, indicating slowing growth in the world’s fastest-growing economy, according to a report issued by Bloomberg.
The Indian Ministry of Statistics reported that the industrial production index decreased by 0.1% compared to the previous year, after recording a growth of 4.7% last July. Economists polled by Bloomberg had expected a 1% increase.
Signs of slowing growth
These numbers are in line with other indicators that show that India’s rapid growth is slowing. While purchasing managers’ surveys in September showed a slowdown in the services and manufacturing sectors, while the production index for the eight basic industries such as steel, coal and cement fell by 1.8% compared to the previous year.
Mixed outlook for growth
After the Indian economy witnessed growth of more than 8% during the fiscal year ending in March 2024, economists began to increasingly adjust their expectations regarding GDP growth for the current year.
Estimates of economists polled by Bloomberg indicate growth of 6.9%, while some banks, such as Goldman Sachs, expected a decline in growth to 6.5%.
However, the Reserve Bank of India remains more optimistic, maintaining its 7.2% growth forecast earlier this week.
