Right to Information
Irregularities in IIT JEE: Will the new HRD minister offer justice to this tenacious whistleblower?

Rajeev Kumar, professor of IIT Kharagpur, is consistently using RTI to expose irregularities in the IIT joint entrance examination and has triumphed by making the entrance test transparent this year but he has been suspended since 2011. Last week the HRD ministry had directed IIT Kharagpur to act on his indefinite suspension. An overview of his amazing battle through RTI

What happens if you doggedly try to cleanse up a corrupt system? You would be suspended from work if you happen to be professor Rajeev Kumar, a computer science engineering professor at IIT Kharagpur, even though the Supreme Court has hailed him as  “one of the many unsung heroes who helped in improving the system.”

On 22nd October, the human resources development (HRD) ministry in a letter, had ordered the Director of IIT Kharagpur for ‘urgent’ revocation of suspension and appointment of an independent commissioner for departmental enquiry regarding professor Rajeev Kumar’s indefinite suspension since March 2011. This comes as a sequel to several reminders made by the Central Vigilance Commission (CVC) to the IIT management to “examine the issue.” The CVC then on 25 September 2012 brought this indefinite delay to the notice of the HRD ministry which then issued a letter to the Director, IIT Kharagpur last week. To date, Kumar is debarred from teaching and research work and entering his departmental office complex and laboratories.

Ever since his son missed admission to IIT in 2006 by just three marks, he has been pursuing the flawed marking and student selection process of the Joint Entrance Examination (JEE) common to all IITs by filing a string of RTI (Right to Information) applications. RTI documents showed that 994 top scorers of JEE 2006, the year in which his son too appeared for the entrance examination, failed to make it to the IITs whereas lower scoring candidates were given admissions. According to Kumar, “this was due to faulty calculation of cut-off marks”. So he decided to go about correcting the flawed system to bring in transparency to this prestigious entrance test so that brilliant students are not denied entry into the esteemed IITs. His suspicion about the transparency of the candidate selection system grew when RTI replies revealed that the optical response sheets of 2006 (answer sheets in layman’s language) were ‘shredded’ (destroyed) despite the rule being that they should be preserved for one year. Also, the management of the IIT changed its version thrice in the CIC hearing and court regarding the formula it adopted for calculating cut-off percentage.

What provoked this IIT professor to use RTI so rigorously? In September 2006, Kumar read in the newspapers that the CIC ordered the UPSC (Union Public Service Commission) to reveal its admission and selection procedure and so was inspired to pursue the same for IITs.

Thanks to Kumar’s sustained efforts at the expense of being “threatened, harassed and victimised by the Director, deans and the registrar of IIT Kharagpur since he is filing RTI applications and exposing certain wrong-doings (as recorded in a CIC order)”, for the first time the IIT JEE entrance test of April 2012 displayed transparency. The students were provided carbon copies of their answer sheets; the model answers have been put up on the IIT website to facilitate students to cross check their answers and thereby marks and; the cut-off percentage was announced prior to the examination instead of after evaluation of the answer sheets. This was a sequel to a Supreme Court judgment which directed the IITs to upgrade the selection process and make the system more transparent.

Between September 2006 and January 2012, Rajeev Kumar has filed over 50 RTI applications for information on various facets of IIT JEE entrance examination and other alleged mal-administration in IIT Kharagpur, even as he was fighting a legal battle in the high court and Supreme Court. He has also filed 39 second appeals/complaints to the Central Information Commission between May 2007 and April 2012.

Prof Kumar has been ironically suspended by the management of IIT Kharagpur in May 2011 for “damaging the reputation of the institute” because he made allegations on procedures adopted for IIT JEE entrance examination, exposed copying in these examinations and highlighted irregularities in purchase of laptops. The management of IIT Kharagpur in turn has alleged his involvement in corruption in purchase of laptops. As per rules, it is mandatory to form a committee to review his suspension as he comes under the Central Civil Service Rules of 1965. IIT Kharagpur, though stated that it has its own set of statutory rules for suspension cases, has issued him a letter saying that his suspension would continue till further orders. The HRD ministry in its letter has scuttled that argument.

Kumar filed his first RTI application in September 2006 seeking information on the cut-off marks for each subject (Physics, Chemistry, Mathematics) and marks scored by the top 2,000 students who had got through to IITs. IIT-JEE tests examine the analytical abilities of a student in Physics, Chemistry and Mathematics. The students get a call for ‘counselling’ if they clear the pre-determined cut-off marks set for each subject as well as score the required aggregate marks.

After the PIO failed to reply, Kumar filed a first appeal but that too was ignored. He then filed a second appeal to the CIC. Kumar also simultaneously filed another RTI application asking for the procedure followed to determine the cut-off marks, the question paper with model answers and names of all the people associated with the examination procedure of 2006.  The PIO of IIT stated in an evasive reply that there was “no set procedure to determine cut-off marks” and also refused to reveal the question paper. Then he filed a third application in January 2007 on the number of students who got marks above the cut-off marks and had got selected.

In April 2007, the CIC ordered the IIT Kharagpur to provide him the required information on all the three RTI applications he had filed. The information finally provided to him but did not explain how they reached that cut-off. IIT gave yet another explanation of the cut-off system in September 2007 and then submitted a third explanation to Kolkata High Court in August 2009. This proved there was no proper system.

In fact, for years, says Kumar, the selection of candidates was a very complex procedure and it was never made public. There was utmost secrecy in the marking procedure. As per rules, each year, one of the IITs is in charge of conducting the examination.

After Kumar was provided the list of all candidates who had cleared the examination of 2006, he analysed the marks of 32,000 candidates and was shocked to find that there was discrepancy in the cut-off marks. It showed that his son Sanchit and 993 others were wrongly excluded from being called for the next round which is called ’counselling’. The information also revealed that sons and daughters of IIT professors are almost always selected. Armed with this information he approached the Kolkata High Court but the judge did not allow the petition. The Supreme Court too dismissed his appeal regarding his son’s case. It however stated in its recent judgment that: Excerpts from Supreme Court Judgment [(2012) 1 SCC 157] “... the action taken by the appellants in challenging the procedure for JEE 2006, their attempts to bring in transparency in the procedure by various RTI applications, and the debate generated by the several views of experts during the course of the writ proceedings, have helped in making the merit ranking process more transparent and accurate... IITs and the candidates who now participate in the examinations must, to a certain extent, thank appellants for their effort in bringing such transparency and accuracy in the ranking procedure. ...have to be satisfied in being one of the many unsung heroes who helped in improving the system.”

For Prof Rajeev Kumar, the story is far from over. More than 20 appeals/complaints are pending with the CIC against deemed refusal of information and submitting false/irrelevant/misleading information. His aim is complete cleansing of the irregularities and corruption in IITs. Too Utopian?

(Vinita Deshmukh is the consulting editor of Moneylife, an RTI activist and convener of the Pune Metro Jagruti Abhiyaan. She is the recipient of prestigious awards like the Statesman Award for Rural Reporting which she won twice in 1998 and 2005 and the Chameli Devi Jain award for outstanding media person for her investigation series on Dow Chemicals. She co-authored the book “To The Last Bullet - The Inspiring Story of A Braveheart - Ashok Kamte” with Vinita Kamte and is the author of “The Mighty Fall”. She can be reached at [email protected].)



Samantha Roy

5 years ago

IIT Kharagpur – Officiating Registrar Mr. T K Ghosal who appeared for interview on Dec 05. 2012 for the Post of Registrar in IIT Kharagpur does not fulfil the minimum qualification prescribed for recruitment as per UGC / MHRD / Judgement of Supreme Court of India, i.e., 10+2+3+2 / 11 + 1 + 3 + 2 pattern, and has secured less than 50% marks in Master’s Degree received by Distance Education.

As per MHRD / UGC norm, the educational qualification for the post of Registrar must be as Under:

“A Master’s Degree with at least 55% of Marks or its equivalent grade of ‘B’ in the UGC Scale 7 point scale.”

Members of Screening Committee have shortlisted the name of Dr. T K Ghosal without following the above criteria and T K Ghosal’s allegations.

Prof B K Mathur who is one of member in the screening committee for shorlisting the candidates for the post of Registrar in IIT Kharagpur is under CBI scanner because of his involvement in fake institute scam in IIT-Kharagpur. B K Mathur, current chief vigilance officer, was a member of the board of governors of IEE (I) in 2001.



In Reply to Samantha Roy 5 years ago

Sankar Kumar Som
Director(officiating), Indian Institute of Technology, Kharagpur

Dear Director,

I understand that IIT Kharagpur is looking for a Registrar and out of the applicants the Officiating Registrar Mr. T K Ghosal who does not meet the qualification requirements as per MHRD/ UGC Norm/ Judgement of Supreme Court of India, i.e., 10+2+3+2 / 11 + 1 + 3 + 2 pattern, and has secured less than 50% marks in Master’s Degree received by Distance Education, appeared for interview on Dec 05. 2012 for the Post of Registrar in IIT Kharagpur
As per MHRD / UGC norm, the educational qualification for the post of Registrar must be as Under: “A Master’s Degree with at least 55% of Marks or its equivalent grade of ‘B’ in the UGC Scale 7 point scale.”

Unless there is something else to show, which I am sure you do not have, it will be wrong to appont a person who does not meet the minimum requirements for the post. It is a legal question but there are other related questions? Do we not have better people available out of 120 crores Indians for the post? Have the IITs gone so low as to appoint a disqualified person for the post. What efficiency and work culture will develop at IITKgp with such a person holding a key post.

I request you to please clarify/ justify what is the interest or reason for giving consideration to Sri T.K. Ghoshal, a non-qualified person for the post when he is not fit to be officiating Registrar either.

Madhur Kotharay

5 years ago

I don't understand what we are arguing about. Ashok Das and Nikunj don't agree with the article and have voiced their opinions why they don't.

What is the need to start accusing them of yellow journalism in the name of IIT KGP?

I don't know who is right: Prof RK or IIT, KGP. So I have no sides to take but I believe that we should let people disagree as long as they are not offensive. I did not find anything objectionable in Ashok Das' writeups; in fact, he has been polite all through. Whether he is truthful is not a call I can make but so be it.

I am not a lawyer interested in dissecting the case. I am a graduate of IIT Bombay (I entered IIT in 1983, not 2006 :-)) and am fairly active with IIT Bombay Alumni Association. So, yes, IITJEE's reputation concerns me more than most of you.

Having dealt with thousands of IITians and hundreds of IIT professors over the last 29 years, I can guarantee you that there are professors who could stoop as low as accused in this case, and then there are professors who are paragons of virtue.

So I would be happy if both sides of the story are presented.

P M Ravindran

5 years ago

I am glad that Prof Rajeev Kumar has succeeded in bringing transparency to the selection process through IIT JEE. I wish God speed for his reinstatement and punishment for the guilty.


5 years ago

While going through the acrimonious debate, more than the Article itself, I found the discussion, as not very useful, which is leading to the loss of direction in dealing with the major issue. In fact, the issue before us is whether the admission to IITs through JEE is sacrosanct or there is a play and chances of making the merit list upside down and deny the meritorious ones admission into IITs. Can we remain on this, though Prof RK's issue as Whistleblower is extremely important, rather than trying exclusively to solve Prof RK's problem
My own feeling is that buying items of personal/ domestic uses from Project money is very common in every IIT, in every University etc. There can be a study on this with interesting output. And IIT Kgp used this lever to pull RK down leaving others untouched.
Prof RK got interested in RTI because his son could not get admission in IITs has nothing wrong in it. All of us get to know of the issues only when it hurts us directly.

Rajesh Kothari

5 years ago

It is bit surprising that no one laments the fact that 993 students were denied admission to IIT in 2006 because of fault of admission process.

I remember, my son had appeared in 2006 JEE and lost chance to get in because he got less marks in Maths. That year, Maths paper was very tough. He had got good marks in other two subjects. Just because he had 15 marks (I hope it is correct) in Maths he could not get in. May be he was one of the unlucky 993 mentioned in the article.

He tried once again in 2007 and got admission at IIT Bombay. But he lost one year.

Can any one compensate him in any way for loss of 1 year of his student life?

I appreciate efforts put in by Prof to bring transparency in the IIT JEE entrance system.

Ashok Das

5 years ago


Ashok Das

5 years ago

Prof Rajeev Kumar has not been suspended for JEE applications but for fraud acts like buying laptop for his son using govt money, maliciously maligning IIT by spreading false information, threatening and pressurizing officials to achieve personal gains, etc. So kindly do not get misled or mislead people by implying that he is suspended for RTI or JEE. Documents are now available showing his unethical acts, attempts to obtain personal benefits using his 'RTI fame', etc. While JEE may become better, it does not entitle a person to do fraud and malign others and get away with it because he is powerfully connected. Also please see the Supreme Court judgement which clearly says that all his claims are wrong and in fact have no iota of evidence. Kindly see the facts and consider all sides to bring out a truly balanced story and not a one-sided one that shows unusual bias. Thanks and Regards


Sandeep Khurana

In Reply to Ashok Das 5 years ago

Mr Das,
Your reply indicates a vindictive attitude by the institute. If all that the institute could gather against a whistle-blower who exposed not just JEE irregularities but also laptop procurement scandal and more is a laptop misuse and defamation and "etc" mangoman understands what is happening. More facts from you would help if you have a case. Did IIT inquire laptop misuse by each and every professor or was Prof Rajeev singled out? Did IIT press defamation suit against professors whose wards got admission despite low merit based on JEE irregularities? Did they not bring ill-fame to IIT? Does IIT have whistle-blower protection policy? since IIT is so fair in punishing is it also fair in rewarding and did IIT reward and recognize Prof Rajeev,when SC judgment said and I quote,""IITs and the JEE candidates who now participate in the examinations must, to a certain extent, thank the appellants for their effort in bringing such transparency and accuracy in the ranking procedure."

Ashok Das

In Reply to Sandeep Khurana 5 years ago

Respected Sir,

Kindly see my response to the author below. Linking RTI to his suspension is misleading people. You must have seen documents on the net which show how Prof Kumar tried to purchase a laptop for his son using Govt funds,etc. When he got caught, he tried to blame everyone, use RTI to move the matter to another direction and fool the public at large. This is all well recorded now. We can always agree to give credit where it is deserved but not malign others for wrong things. Let us have a strong RTI movement by people who do not use their power of activism for personal gains and threats to ordinary people. Thank you for your time and thoughts.

Sandeep Khurana

In Reply to Ashok Das 5 years ago

Mr Das,

Linking of RTI with his suspension cannot be done overtly by IIT. It will be illegal.Therefore, formal claims of not linking the two are not sufficient if that is not so borne by IIT's actions.

But how bureaucracy can get after an individual, especially whistle-blower is what is becoming obvious with your replies.
To take an analogy, I am sure none of us is naive to also not know why govt alleges funding issue of IAC (but does not disclose its own party funding) and not get after every NGO in the country. Don't tell me it is random and govt's prerogative. C'mon we all know. Back to issue- you did not answer if IITs probed and regularly probe all misuse of laptops or only his.

If in the minds of IIT decision-makers the two (his RTI pursuits and his alleged misdemeanours)are not linked and you acknowledge his contributions, let IIT formally praise him on record. Please share if done. Instead they resist in court till finally hauled up. My other questions to assuage apprehensions that he is not singularly targetted remain unanswered. Is IIT reputation more damaged by expose of irregularities or by those who negligently or wilfully allowed systemic errors and/or misused to get their wards in- any IIT board resolution condemning such people?

I also disagree with your comments that courts only said one positive statement and rest is all criticism. It even went on to say "the results would have been different and the first appellant might have obtained a seat". Many anomalies IIT has not been able to defend still. Answer sheets were burnt before prescribed limit. Why? In any case, if IIT recognized his contribution, why did he have to fight all the way to SC? Simple- IITs do not like a closed system at least some in power at IIT were benefitting from and had to answer for, being made open. I am afraid IITs have to come clean on his suspension being absolutely unrelated to his RTI actions. Name all people who brought ill fame to IIT, not one who you acknowledge brought good repute in one way at least.

Vinita Deshmukh

In Reply to Ashok Das 5 years ago

Dear Mr Das
You surely cannot deny Prof Rajeev Kumar the tenacity with which he pursued the technical flaws and irregularities in selection of candidates in the prestigious IIT JEE examinations by persistently using RTI. While it requires guts to be a whistleblower by being in the system, your institute had shown cowardice by not providing him information under RTI. You provided the information only after the CIC decision. You surely cannot deny him the credit of bringing in transparency in selection of candidates who appeared for IIT JEE. Until recently, the examination results were veiled under secrecy. Whatever fraud you are alleging, it is for you to sort it out. That is a purely internal matter. My story has highlighted his tenacious fight to bring in transparency in the IIT JEE system with the use of RTI. So, there is no question of `unsual bias' to which I take strong objection to.

Ashok Das

In Reply to Vinita Deshmukh 5 years ago

Respected Vinita Deshmukh,

Good Morning and many many thanks for your response. Let me explain again that I feel that either you are misled with insufficient inputs or otherwise you have taken a position where reason and facts will not change anything in your view.

I do not wish to deny anyone including Prof Kumar his due credit even an inch, but we should not also falsify things and present to the public what is wrong and untrue.

My main objection is that you link his use of RTI to his suspension and convey the impression that he is suspended because of his RTI. This is false. Please find out from the respective people. So your first line which says that

"Rajeev Kumar, professor of IIT Kharagpur, is consistently using RTI to expose irregularities in the IIT joint entrance examination and has triumphed by making the entrance test transparent this year but he has been suspended since 2011."

immediately conveys a wrong information to all that he is suspended because of his RTI applications is wrong and misleads people. It wrongly throws IIT in bad light. This is why I wrote to you pointing out bias, maybe unintentionally due to getting inputs from only one source.

My second objection is your picking and choosing of only the portion of the Supreme Court Judgement that is related to the Court calling him an 'unsung hero'. The Supreme Court clearly states that all his claims are dismissed and even goes on to state that there is no iota of evidence, etc. Unfortunately you do not reflect the same. This again makes the story quite coloured and biased in one direction when High Courts and Supreme Courts have dismissed several petitions.

My third objection is your statement in the response above that 'whatever fraud you are alleging is for your to sort out' is also quite interesting. You seem not interested to see evidence I have emailed you of him allegedly carrying out financial fraud, academic fraud, unethical power-play. If Prof Kumar can state things and you can consider writing it, why should you not be interested in even examining some facts about him? This somewhat strengthens my view that there is bias in your mind at the moment.I would still request you to read the evidences once.

I have a longer list, but I do not wish to consume more of your time on this. In any case as you state, if your story wanted to highlight his RTI fight, then why related it to his suspension?

I am the last person to deny anyone an iota of credit for anything they fight for but if that is at the expense of falsely maligning an institution and persons of repute without providing all sides of the issue, then 'unusual bias' must be attributed to. In this case, from the first line you indicate that Prof Kumar is suspended by IIT because of JEE and RTI and that is wrong and threads facts and seems to hide facts to show only one point of view.

Thank you again for responding to me. I feel grateful that you decided to respond immediately. However, respectfully I am unable to be convinced that the article is not 'unusually biased'



In Reply to Ashok Das 5 years ago

Dear Mr. Das

What is your position in the IIT? Are you the authorised person of IIT to talk about this case?

Best Regards

Kamal Shah

5 years ago

Chor logon ko khurshi se jaldi hatana hoga .Its really sad though not surprising in this duffer regime who are not running the democracy but ruling the demography

Sandeep Khurana

5 years ago

It seems a stereotyped response by the high and mighty, to cover up when any systemic flaw is detected. Even when it is beyond individual blame personally,far from coming clean and acknowledging, "system" gangs up to silence the whistle-blower. As we are seeing with so many IAC and RTI activists. Salute to their courage, as much as intelligence and perseverance.Their tenacity inspires many.



In Reply to Sandeep Khurana 5 years ago

I do agree he did a good job with JEE. But he was not suspended for bringing that into fore front. The Author is showing a false picture. RK has been suspended because he tried to play fraud upon IIT. He tried to buy a laptop for his son using IIT project money, by trying to break basic rules of govt. The matter is sub judicial so would not get into the reason why its taking so long.

Want to know the real truth about RK, the other side also, can send a mail to this ID. yellowjournalism012-at-gmail

Do add the end of the mail ID. We'll be very happy to give you all a detailed picture of everything and yes With Proof. Not like an article as this one, just making one sided allegations. Even the author can send us a mail. And we challenge, can she post an article again with all the proofs we show her???


5 years ago

Its sad that every decision making body has done injustice to the Cases by not rendering it a natural conclusion.

This applies to almost all major Cases, and we as a nation are the sufferer.Be it 2G,CWG,COALG etc.

Its suicidal for each one of us who try to work through senses, integrity-ethics and standards.

And this Inefficiency in the system may be contributed to immoral judges, who are said to be independent.They need to work more harder-faster and efficiently than any common man in the nation.They will have to come out from their fairy dreams and should close cases one after another, they have to act tough against all party involved,and not just keep pushing cases till his lifetime.



Neela Govindaraj

In Reply to uttam 5 years ago

I agree 100%with Vinita Deshmukh. Hats off to you forbringing up this issue. Thanks

Wipro to hive-off non-IT biz into unlisted arm

The new unlisted firm— Wipro Enterprises—will include Wipro Consumer Care & Lighting, Wipro Infrastructure Engineering and Medical Diagnostic Product & Services business

Mumbai: Information Technology (IT) giant Wipro today said it will demerge three non-IT business divisions, including consumer products segment, into a privately-held company to be named Wipro Enterprises Limited, reports PTI.


The new unlisted firm will include Wipro Consumer Care & Lighting (including furniture business), Wipro Infrastructure Engineering (hydraulics and water businesses) and Medical Diagnostic Product & Services business, Wipro said in a filing to the Bombay Stock Exchange (BSE).


Following the move, shares of the IT major surged nearly 7% to Rs375 on the BSE, in the morning trade.


Wipro will remain a publicly listed company that will focus exclusively on information technology, while Wipro Enterprises will be an unlisted company, the filing said.


The board of Wipro will remain unchanged and the demerger will have no impact on the management structure of the IT major, it added.


There will be no change in the leadership of any of Wipro Enterprises’ constituent businesses as well and the Wipro brand will be jointly owned by both the companies, it said.


Azim Premji will remain the executive chairman of the board of Wipro and will assume the position of non-executive chairman of Wipro Enterprises.


“I am confident that the demerger will enhance value for our shareholders and provide fresh momentum for growth. Each of our distinct businesses is best of breed in its respective industry and we are committed to both the businesses,” Mr Premji said.


The date of demerger has been fixed as 1 April 2012, and is expected to be completed by the next financial year, subject to regulatory approvals.


Under the proposed restructuring scheme, resident Indian shareholders of Wipro have three options—receive one equity share with face value of Rs10 in Wipro Enterprises for every five equity shares with face value of Rs2 each in Wipro that they hold.


Receive one 7% redeemable preference share in Wipro Enterprises with face value of Rs50, for every five equity shares of Wipro that they hold.


The third options is exchange the equity shares of Wipro Enterprises and receive as consideration equity shares of Wipro held by the promoter, the filing noted.


The exchange ratio will be one equity share in Wipro for every 1.65 equity shares in Wipro Enterprises.


Each redeemable preference share will have a maturity of 12 months and shall be redeemed at a value of Rs235.20.


TK Kurien, Chief Executive Officer (CEO), IT Business and Executive Director (ED), Wipro said, “Creating a technology-focused company will allow us to better serve the needs of our customers and accelerate investments necessary to capitalise on market growth opportunities.”


Non-resident shareholders (excluding ADR holders) and ADR holders on the record date would be entitled to receive equity shares of Wipro Enterprises in the aforesaid ratio, the filing said.


The non-resident shareholders (excluding ADR holders) shall further have the option to exchange the Wipro Enterprises’ equity shares that they are entitled to and receive equity shares of Wipro Limited held by the promoter in the aforesaid ratio.


According to the restructuring scheme as currently proposed, Wipro Enterprises equity shares that the ADR holders would otherwise be entitled to receive, shall be compulsorily exchanged for equity shares of Wipro held by the promoter in the aforesaid ratios.


India’s manufacturing growth improves in October: HSBC PMI

Inflation as measured by all indices has remained elevated and Wholesale Price Index-based inflation has remained above the RBI’s comfort zone of 5% to 5.5% for past 34 months now

New Delhi: India’s manufacturing sector inched up in October 2012, driven by new orders, but persistent power shortages weighed on production, reports PTI quoting an HSBC survey.
The HSBC India Manufacturing Purchasing Managers’ Index (PMI)—a measure of factory production—stood at 52.9 in October 2012, slightly up from September 2012, when it was 52.8.
The index has remained above the 50-mark, below which it indicates contraction, for more than three years now.
The October reading of HSBC PMI points to a further improvement in the health of the manufacturing sector, which witnessed the weakest growth rate in nine months in August.
However, going forward, the recovery in manufacturing growth is likely to be ‘slow’, HSBC said, adding that backlogs of work in the Indian manufacturing sector were accumulated at a sharp rate during October 2012, mainly due to persistent power shortages.
“Economic activity in the manufacturing sector picked up slightly, thanks to firm new orders. However, insufficient power dampened output growth and led to an increase in outstanding work,” HSBC chief economist for India and ASEAN (Association of Southeast Asian Nations) Leif Eskesen said.
On inflation, HSBC said it eased notably with both output and input prices rising at a slower pace in October but it is still likely to stay “elevated for a while”.
Input price inflation in the Indian goods-producing sector persisted in October and part of the burden of input cost inflation was passed on to clients as output prices were increased again. However, the rate of inflation was the slowest since November 2010, HSBC said.
Inflation as measured by all indices has remained elevated and Wholesale Price Index-based inflation has remained above the Reserve Bank of India’s (RBI) comfort zone of 5% to 5.5% for past 34 months now.
In the mid-year monetary policy review on 30 October 2012, the RBI left the key interest rate unchanged but reduced cash reserve ratio by 0.25% to infuse additional liquidity of up to Rs17,500 crore into the system.
The RBI kept the repo rate and reverse repo rate unchanged at 8% and 7% respectively.
Meanwhile, staffing levels at the manufacturing firms increased, marking an eight-month sequence of job creation.
The payroll numbers were raised largely to support new orders growth, the HSBC survey said.
This is the second successive monthly expansion in new export orders and new orders increased for the forty-third consecutive month.


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