Rising cost, inflation fail to dampen industry mood: Survey

NEW DELHI: Close to one-third of 135 sectors, reported a high growth of 10-20 per cent while 42 per cent showed a moderate expansion of up to 10 per cent in the first quarter of this fiscal, despite concerns over rising borrowing and input costs, according to a survey.

However, the share of sectors reporting 'excellent' growth has declined to 27.7 per cent during April-June 2011-12 from 27.3 per cent a year ago, CII-ASCON survey said.

"The general issues faced by the industry included rise in the cost of raw material, high cost of credit, infrastructure bottlenecks, land acquisition and increasing oil prices," the chamber said.

Despite these problems, the ratio of the sectors putting up negative growth declined to 5.2 per cent in the first quarter of the current fiscal as compared to 15.5 per cent in the same period last year.

The chamber said this indicates "reduced stress". The survey was done across wide range of sectors and companies engaged in basic goods, capital goods, consumer durables and non-durables.

It said that the number of sectors showing a negative growth was reduced to 7 during the quarter from 17 in the previous year.

According to the Survey, the sectors which showed excellent growth included machine tools, forgings, switchgears, tractors, passenger cars, earth moving and construction equipment.

The sectors which grew between 10-20 per cent comprised of automobiles, energy meters, ball and roller bearings, crude oil, scooters and polyester staple fibre.

Cement, motor starters, natural gas, sunflower oil, colour picture tube are some sectors that have shown negative growth rates in April-June 2011.