slowdown: Manufacturing investments fell 15% in FY18: ASI data

Manufacturing sector investments declined 15.2% in 2017-18, the final Annual Survey of Industries (ASI) data released by the government on Wednesday showed. Gross fixed capital formation (GFCF), as measured by the survey was Rs 3.12 lakh crore compared to the provisional 3.31 lakh crore as per the provisional estimates that were released in September last year.

ASI, principal source of industrial statistics in India, is the most comprehensive data on organised manufacturing. The survey was conducted during November 2018 to June 2019 through ASI Web Portal.

GFCF was Rs 3.69 crore in 2016-17.

“This was the period when goods and services tax was still stabilising and the organised sector investments declined,” said an official.

While there was a 1.2% rise in the number of factories in 2017-18, the number of workers rose 4.8% to 1.2 crore.

According to the national accounts, GFCF for the same period for the entire economy rose to Rs 40.61 lakh crore in FY18 from Rs 37.87 lakh crore the year ago in terms of constant prices. In current prices, it was Rs 48 lakh crore in FY18.

Workers include all persons employed directly or through any agency whether for wages or not and engaged in any manufacturing process or in cleaning any part of the machinery or premises used for manufacturing process or in any other kind of work incidental to or connected with the manufacturing process or the subject of the manufacturing process.

The same data also showed that interest paid in 2017-18 declined 0.9% but rent payout rose 9.3%, a dampener on fresh investments.

Total wages provided to factory workers rose to Rs 1.92 lakh crore from Rs 1.73 lakh crore in the previous fiscal. These factories’ profits saw a 6.8% on year increase to Rs 5.76 lakh crore from Rs 5.39 lakh crore in FY17. The provisional estimates had pegged FY18 profits at Rs 5.84 lakh crore.

India’s economy grew 7% in 2017-18.

Source Article

Lois C. Ferrara

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