India's industrial output grew 16.7 per cent in January on robust manufacturing activity, reinforcing the optimism expressed by the Prime Minister of higher economic growth that prompted partial roll back of stimulus measures in the Union Budget 2010-11.
Growth in January is, however, a tad slower than December's 17.6 per cent. Prime Minister Manmohan Singh has exuded confidence that the economy would reach the growth orbit of nine per cent next fiscal.
"For the two consecutive months, there has been high growth. Perhaps, it indicates that the manufacturing sector is going to make substantial contribution to growth and it (economy) is on the path of fast recovery", an exuberant Finance Minister Pranab Mukherjee said on the industrial performance.
In February, Mukherjee had announced higher excise duty - applicable on the manufacturing sector - besides raising Minimum Alternate Tax on the corporate sector and duties on crude oil, as a part of partial roll back of stimulus.
"As a conservative person I will like to wait for one more month figure. But signal is quite clear and it is encouraging", Mukherjee said, adding that with the high industrial output it would be possible to achieve 7.2 per cent economic growth in 2009-10, as projected by the government.
Higher output in January, when stimulus was in place, can be attributed to 17.9 per cent and 14.6 per cent expansion in manufacturing and mining sectors, respectively. PTI