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More production cuts, layoffs in manufacturing

Source: PTI
December 09, 2008 17:08 IST
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Several manufacturing sectors could see production cuts up to 50 per cent and downsizing of employment up to 30 per cent in the coming months, indicating inability of the stimulus package to revive industrial growth from shadow of global downturn, a survey has said.

Between November and March this fiscal, several manufacturing segments such as textile, leather and leather products are expected to cut production up to 50 per cent and downsize payroll up to 30 per cent, a survey done by the Federation of Indian Chambers of Commerce and Industry (Ficci) revealed.

"Manufacturers in major sectors have reportedly planned cuts in their production for the period November 2008 to March 2009. This implies that the growth for the manufacturing sector could further slowdown in the coming months if the current economic uncertainties continue," the chamber said, while releasing the survey.

It said sectors such as textiles, metals and metal products, leather and leather products and other segments such as jewellery have reported negative growth up to 30 per cent in October.

"Despite the government's stimulus package, manufacturing sector is not likely to see any revival in its growth soon", Ficci added.

Following cut in short term lending rates by the Reserve Bank, the government on Sunday had announced across-the-board four percentage points cut in excise duties to boost industrial demand.

It also announced several incentives for exporters besides a booster package for the infrastructure sector to limit the impact of the global slowdown on Indian industry.

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