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Double digit IIP growth shows economic recovery: Industry

business Updated: Oct 12, 2009 19:37 IST

India Inc on Monday said double-digit growth in industrial production in August shows robust economic recovery but asked the government and the RBI to continue the stimulus measures to sustain the uptrend.

Several fiscal and monetary incentives since December 2008 helped the industry to recover into a growth trajectory. The 10 per cent plus growth in manufacturing, basic goods, mining, electricity has been buoyed by these measures, industry chamber CII said in a statement here.

"It is important to nurture this economic recovery by continuing with the current fiscal and monetary space which has been given, especially during a year of poor monsoons," CII Director General Chandrajit Banerjee said.

Even though RBI is expected to maintain a status quo in its monetary policy at its upcoming review on October 27, the double digit industrial growth will give it some comfort to tackle inflationary pressures later.

"CII hopes the RBI would give the welcome signal of an accommodative monetary policy...," Banerjee said.

In August, factory output grew by 10.4 per cent on the back of double-digit growth in mining, manufacturing and electricity sectors. Industry production had expanded by 1.7 per cent in the same month last year.