Industrial slowdown taking serious dimensions
New Delhi: The 5.1% decline in October IIP came as a serious disappointment to industry, which was not expecting such a sharp decline despite the base effect at work.
CII surveys have been pointing towards declining business sentiment and poor growth prospects for some time.
CII Director General Chandrajit Banerjee said, while all sectors have fallen in October, the sharp decline in the capital goods sector is of particular concern, as it indicates a lack of investments, which will continue to be a drag on growth.
The continued decline in the mining sector indicates the problems created by the closure of mines. CII is concerned that if allowed to continue, this would have serious consequences on employment and livelihoods.
CII believes urgent measures are required to induce investments, including creating a shelf of bankable projects - particularly in infrastructure, identifying the top 100 investment projects in the country and having them taken forward with a monitoring mechanism instituted at the Centre, gradual roll back of interest rate increases, improve the fiscal situation - which in trurn would help ease the effective rate of interest, create a taxation environment that is conducive for investments, among other measures.
The industrial slowdown is taking very serious dimensions and there is an urgent need to improve sentiments if the downward trend has to be checked.