The Narendra Modi government suffered a double blow on Friday with industrial output contracting by 1.6 per cent and retail inflation spiralling to a three-month high of 5.03 per cent in February on the back of rising food and fuel prices.

Industrial output had risen by 1.6 per cent in December, according to revised estimates.

The double whammy meant that the government’s recent assertion of a broad-based economic recovery — bolstered by an unexpected 0.4 per cent growth in real gross domestic product (GDP) in the third quarter (October-December 2020) — has come under strain.

The big worry is that the manufacturing sector, which has an over 77 per cent weightage in the index of industrial production (IIP), has contracted again by 2 per cent.

Manufacturing had flickered to life in December last year by recording a 2.1 per cent growth. This is actually a revised number that was put out on Friday.