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India's manufacturing sector in slump
Nov 8, 2013

The Indian economy has been witnessing a severe economic slowdown with growth rates falling continuously over last several quarters. One of the worst hit areas is the manufacturing sector. Today's chart of the day shows the manufacturing Purchasing Managers' Index (PMI) for the BRIC economies over the last two months. It must be noted that PMI is an indicator of the economic health of the manufacturing sector. A reading above 50 indicates growth, whereas a reading below 50 indicates contraction. It is evident from the chart that while the other BRIC economies such as Russia, China and Brazil have moved into expansion phase in October, India's manufacturing sector continues to slump. The manufacturing sector in India is facing several structural constraints in the form of poor infrastructure, regulatory hurdles, slow reforms, red tape and corruption. Unless policy makers initiate some tough reforms, India's manufacturing sector may continue to slump.

Source: Business Standard

This Chart Of The Day was published in The 5 Minute WrapUp - Have retail investors missed the bus?

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