Manufacturing sector slowing down: CII
23 Apr 2007
New
Delhi: The manufacturing sector has started showing
signs of slowing down especially, in consumer durables
and automobile industry while the profitability of services
sector has already seen moderation, the Confederation
of Indian Industry (CII) said in its quarterly report
on the "State of the Economy".
The
report said the automobile industry sales grew at 0.8
per cent in the month of March 2007 as compared to 20.4
per cent in March 2006. Similarly, growth of production
of consumer durables stood at 1.6 per cent for February,
2007 compared to 20.3 per cent during the same period
last year. These sectors, which start demonstrating
impact of interest rate interventions the earliest and
therefore, are very significant, the CII held.
However, the report found that India Inc continued its bull run during the third quarter of 2006-07 and the net sales and profit after tax (PAT) of 3834 firms surveyed, grew by 21 per cent and 74 per cent respectively compared to 18 per cent and 1 per cent recorded a year earlier.
CII said much of the growth in sales is owing to domestic consumption having gone up on the back of a buoyant economy.
The
CII has projected that with interest rates rising and
demand contracting and exports slowing down, it is only
a matter of time before manufacturing sector also comes
under pressure and starts slowing down.