Industrial production contracted in August 2016. The Index of Industrial Production (IIP) fell by 0.7 per cent in August, compared to a decline of 2.5 per cent in July, according to data from the Central Statistics Office. The IIP contracted by 0.3 per cent in April-August 2016, first five months of this financial year, versus growth of 4.1 per cent in the corresponding period last year. However, a good monsoon and early onset of the festive season have raised hopes of revival in demand for consumer durables. Mining and manufacturing dragged down overall IIP for the month. The mining sector contracted by 5.6 per cent, from 0.9 per cent growth the previous month. The manufacturing sector which makes, 75 per cent of the index, saw the intensity of decline get lower, to 0.3 per cent from 3.4 per cent in July. Dismal when compared with the 6.6 per cent growth in August last year, the government expects the economy to expand between seven to 7.75 per cent in 2016-17.

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