Eight core sectors’ output slows to 4.4% in September

The output of eight core sectors rose 4.4 per cent in September on account of healthy performance by segments like natural gas, refinery products and cement, official data showed on Friday.

The eight infrastructure sectors of coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity had grown by 0.6 per cent in September 2020, as per the data released by the commerce and industry ministry.

Core sectors’ growth stood at 11.5 per cent in August thus year.

The eight core industries comprise 40.27 per cent of the weight of items included in the Index of Industrial Production (IIP).

Production of natural gas, refinery products, and cement increased by 27.5 per cent, 6 per cent and 10.8 per cent in September 2021, respectively.

However, crude oil production declined by 1.7 per cent in September year-on-year.

The growth rate of these infrastructure industries during April-September 2021-22 stood at 16.6 per cent, as against a contraction of 14.5 per cent in the year-ago period.

Commenting on the numbers, Aditi Nayar, chief economist at Icra, said with the base effect wearing off and copious rainfall dampening mining and construction activities as well as demand for electricity, the core sector growth slid to 4.4 per cent in September.

Lower core sector growth and the impact of semiconductor shortages on auto output are expected to dampen the September 2021 IIP growth to 3-5 per cent, despite the pre-festive season inventory buildup suggested by the GST e-way bill data, she added.

“While the sequential momentum would improve, we expect the YoY core sector growth to remain subdued at 4-5 per cent in October 2021,” she further said.

According to the data, the growth rate of coal and steel output in September declined to 8.1 per cent and 3 per cent from 21 per cent and 6.2 per cent in the same month last year, respectively.

Similarly, growth rate in the electricity generation moderated to 0.3 per cent from 4.8 per cent in September 2020.

Fertiliser output rose marginally by 0.02 per cent in September from (-)0.3 per cent in the year-ago month.

Related Posts

Comments are closed.

© 2024 Economics - Theme by WPEnjoy · Powered by WordPress