{"id":112283,"date":"2021-06-14T13:09:03","date_gmt":"2021-06-14T07:39:03","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=112283"},"modified":"2021-07-01T13:10:55","modified_gmt":"2021-07-01T07:40:55","slug":"renewed-uncertainty","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/renewed-uncertainty\/","title":{"rendered":"Renewed uncertainty"},"content":{"rendered":"<p><b>Source: <\/b><a href=\"https:\/\/epaper.thehindu.com\/Home\/ShareArticle?OrgId=GE98LRS3S.1&amp;imageview=0\"><b>click here<\/b><\/a><\/p>\n<p><b>Syllabus: GS 3<\/b><\/p>\n<p><b>Synopsis: <\/b><span style=\"font-weight: 400;\">A near-term revival in consumption-led demand appears bleak now.<\/span><\/p>\n<p><b>Introduction\u00a0<\/b><\/p>\n<p><span style=\"font-weight: 400;\">The recent factory output data released by the National Statistical Office indicate a rocky start to the economy in the new fiscal year.\u00a0<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">April\u2019s Index of Industrial Production (IIP) estimates show all three sectoral parts of the index, i.e. mining, manufacturing, and electricity have suffered reverses, as output slid below the previous month\u2019s levels.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Due to the second wave of the COVID-19 pandemic, all six end-use categories are, primary, capital, intermediate, and construction goods and consumer durables and non-durables borne month-on-month contractions.<\/span><\/li>\n<\/ul>\n<p><b>What does the factory output data released by the National Statistical Office show?<\/b><\/p>\n<p><span style=\"font-weight: 400;\">\u00a0Manufacturing saw production shrink 12.6% from March and contributed considerably to a 13% sequential contraction in overall industrial output. Manufacturing, otherwise, accounts for 77.6% of the IIP.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><b>Firstly, the NSO advised not to draw a year-on-year comparison<\/b><span style=\"font-weight: 400;\">. <\/span><b>It said that it would be affected by the fact that the nationwide lockdown<\/b><span style=\"font-weight: 400;\"> had stopped many institutions from operating in April 2020.<\/span>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">\u00a0Figures from April 2019 indicate the IIP registered a marginal 0.08% growth, supported by a 6.8% increase in electricity output from two years earlier.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\"><b>Secondly, manufacturing contracted 0.9% from the pre-pandemic level<\/b><span style=\"font-weight: 400;\">, indicating the deep pothole it finds itself in. The output of capital goods and consumer durables also dropped as compared to 2019 levels by 14.3% and 11.6% respectively. This shows that the outlook for investment in production capacity and unrestricted <\/span><b>consumption remains upsettingly weak<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\"><b>Thirdly, the second wave brought in demand destruction<\/b><span style=\"font-weight: 400;\"> as consumer <\/span><b>non-durables, comprising household essentials, had contracted by 11% from March<\/b><span style=\"font-weight: 400;\">. The IIP arrives with a lag of six weeks, so it can be viewed as an indicator of past economic activity instead of a tool to assist in providing an exact projection.<\/span><\/li>\n<\/ul>\n<p><b>The conclusion\u00a0<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Job losses are accelerating and consumer spending is impacted by a blend of falling real incomes, exhausted savings and increasing health-care costs. This makes the broader outlook for a near-term revival in consumption-led demand appears bleak right now.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">To ensure a long-lasting recovery, the government needs to accelerate targeted, demand-creating fiscal support measures and drastically quicken the pace of vaccinations.<\/span><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Source: click here Syllabus: GS 3 Synopsis: A near-term revival in consumption-led demand appears bleak now. Introduction\u00a0 The recent factory output data released by the National Statistical Office indicate a rocky start to the economy in the new fiscal year.\u00a0 April\u2019s Index of Industrial Production (IIP) estimates show all three sectoral parts of the index,&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/renewed-uncertainty\/\">Continue reading <span class=\"screen-reader-text\">Renewed uncertainty<\/span><\/a><\/p>\n","protected":false},"author":10315,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[9],"tags":[],"class_list":["post-112283","post","type-post","status-publish","format-standard","hentry","category-public","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704814524},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/112283","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10315"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=112283"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/112283\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=112283"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=112283"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=112283"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}