Chief Economic Advisor Krishnamurthy Subramanian said China imports a lot of components, parts, assembles and integrates and then exports them.
The positive numbers raises hopes of recovery.
Propelled by a strong growth in manufacturing, the industrial production grew by 6.4 per cent in January over the same period of the previous year.
Vivek Mahajan (Head - Research) Aditya Birla Money, analysed the slow IIP growth.
The 30-share Sensex ended down 12 points at 25,610.
Categories such as washing machines, refrigerators and television sets have seen sales growth of around 8-10 per cent in August compared to last year, industry sources said, with September also reporting a similar growth trajectory.
A rate cut could stimulate demand and help revive industrial activity, without much risk of sparking off inflation again.
Fertiliser production dropped sharply by 11.5 per cent, crude oil by 5 per cent and natural gas by 0.9 per cent in October over the year-ago month
India's annual industrial output growth slowed to 4.2 per cent in July compared with an upwardly revised 4.4 per cent growth a month ago, government data showed on Friday.
An index value of 42 to 46 means moderate decline.
What came to the rescue of the IIP numbers in February were mining and electricity.
'Let's not get carried away by stocks like D-Mart, Jubilant Foods and all those companies that are trading at an expensive valuations.'
India's GDP estimates for 2020-21 show that the economy is expected to perform much better than earlier projections by different agencies, indicating a sustained V-shape post-lockdown recovery, experts said. The first Advance Estimates (AE) by the National Statistics Office (NSO) has projected a contraction of 7.7 per cent in the real GDP during 2020-21. This was better than the projections by certain international agencies like the IMF and World Bank.
Economists surveyed by Reuters had forecast a 0.5 per cent growth in output
The fiscal 2008-09 began on somber note with industrial growth in April dropping to 7 per cent compared to 11.3 per cent in the same month a year ago, reflecting the impact of higher interest rates and rising input costs.The performance in April, however, was much better than the 3.9 per cent growth rate witnessed during March, the last month of the previous fiscal, according the Index of Industrial Production (IIP) data released on Thursday.
Industrial production growth rate has declined to 7.6%, due to dismal performance by manufacturing, mining and electricity sectors.
The NSE Nifty settled the day 28.30 points, or 0.27 per cent, lower at 10,554.30.
Stock markets will remain closed on Tuesday
Lack of new investments may undermine higher consumption
The Index of Industrial Production recorded an impressive growth of 11 per cent in February despite power sector registering dismal performance indicating unpleasant summers in the days ahead.
Department of Economic Affairs secretary Atanu Chakraborty said that equity capital flows have been positive this year.
The broader NSE Nifty recaptured the key 10,000-mark and ended at 10,096.40
The NSE Nifty closed lower by 32.15 points, or 0.32 per cent, at 9,984.80.
The November IIP has been revised upwards to 3.9% from 3.8%.
'The economy is suffering (perhaps 'enjoying' is a better word) the lowest credit demand in decades; banks are struggling with stressed loans equivalent to near 10 per cent of GDP,' points out Devangshu Datta.
Slow growth in key sectors would also have implications on the Index of Industrial Production number
Changes the base year and included more sectors.
The eight sectors, which also include fertilisers, steel, natural gas, electricity and crude oil, had expanded by 1 per cent in June last year.
Top losers include Hero MotoCorp, HDFC, SBI, Infosys, HCL Tech, ICICI Bank, Bajaj Finance, ONGC, Bajaj Auto and IndusInd Bank, falling up to 2.63 per cent.
India's industrial output grew a better-than-expected 6.4 per cent in August compared with a downwardly revised 4.1 per cent growth a month ago.
After contracting for two quarters in a row, the Indian economy entered the positive territory with a growth of 0.4 per cent in the October-December quarter, mainly due to good performance by farm, services and construction sectors, official data showed on Friday. Trade and hotel industry registered a contraction of 7.7 per cent during the third quarter this fiscal, as the sectors continued to suffer on account of coronavirus pandemic. According to the data released by the National Statistical Office (NSO), the farm sector recorded a growth of 3.9 per cent, and the manufacturing sector output grew by 1.6 per cent in the quarter under review.
Consumer durables shrank year on year, which could suggest to observers that spending confidence is yet to return to the economy.
Much of the Q3 data will simply not be available for the CSO to factor in its calculation.
Notable losers were ONGC, Axis Bank, ITC, SBI, ICICI Bank, NTPC, Hero Motocorp, Sun Pharma and Bharti Airtel who fell by up to 2.80 per cent.
Poor performance of coal, petroleum refinery products and natural gas pulled down the core sector growth to 2.1 per cent in December, 2013 from 7.5 per cent in the same month a year ago.
India's gross domestic product growth, which had fallen under 5 per cent, is expected to be between 5.4 per cent and 5.9 per cent this fiscal.
Natural gas output rose by 6.4 per cent in June.
India's GDP is estimated to contract by a record 7.7 per cent during 2020-21 as the COVID-19 pandemic severely hit the key manufacturing and services segments, as per government projections released on Thursday. Amid overall decline in economic activities, some respite was provided by the agriculture sector and utility services like power and gas supply, which have been projected to post positive growth during the current fiscal ending March 2021.
The growth in key sectors will have implications for the Index of Industrial Production as these eight segments account for about 41 per cent of the total factory output.
'Retail investors have been selling since the Budget and Foreign Portfolio Investors started selling.' 'Thus far, domestic institutions have picked up the slack, buying enough to keep the major indices from falling off a cliff.' 'However, there has been carnage in smaller stocks and the financial sector has been hit much harder than the major market indices,' points out Devangshu Datta.
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