India's industrial production declined in previous month and fell below the pace of 6.3%. The main reason behind the decline was slow growth in the manufacturing sector. The index of industrial production (IIP) rose 8.5% in May 2010. Manufacturing sector constitutes about 80% of the IIP and it increased at a rate of 5.6% in May as compared to 8.9% last year. These figures were revealed by the ministry of statistics and programme implementation.

The statistics have also unveiled that mining output rose 1.4% as compared to 7.9% in April 2010. However, the electricity generation increased 10.3% during this month. Consumer goods output rose by 5.4%, while consumer durables production climbed 5.2% against 14.7% in the same month, last year. Capital goods advanced at a slow pace of 5.9%, whereas the production of intermediate products rose only 0.9%.

Another reason behind the sluggish growth was decline in foreign direct investment. India is the only major country in South Asia where FDI inflows fell during 2010.

The Commerce and Industry Minister of India, Anand Sharma has called a meeting with industry chambers tomorrow and the day after to review the blockages the growth of production.