Cement,power push core sector up 1.7% in November

Economists see revival,caution mild activity going forward.

Written by Press Trust Of India | New Delhi | Published:January 1, 2014 10:46 pm

The output of eight key infrastructure industries bounced back 1.7 per cent in November,primarily due to better performance of cement and electricity generation. This might signal a reversal of the downturn.

The output of the core sector comprising crude oil,coal,natural gas,fertilisers,steel,cement,electricity and refinery products had contracted in October.

The data released by the government on Tuesday showed that the cumulative growth in these industries during the April-November period stood at 2.5 per cent compared to 6.7 per cent during the same period a year ago.

This group has a weight of 37.90 per cent in the index of industrial production (IIP), the gauge of industrial activity in the country. It had fallen 0.6 per cent in October.

Electricity generation,witnessed an increase of 5.9 per cent as against 1.3 per cent in October and 2.4 per cent in November last year.

Cement production expanded 4.2 per cent during the month compared to a one per cent growth in October and a contraction of 0.2 per cent year-on-year.

Economists have interpreted the number has a revival in industrial activity,but cautioned that it is likely to remain mild going forward.

“It will have some impact on IIP. We expect mild growth to continue in the second half,indicating some kind of industrial revival but there should not be expectation of a stellar recovery,” DK Pant,chief economist,India Ratings and Research,said.

IIP data for November will be released on January 12.

Index for industrial production contracted 1.8 per cent in October 2013 while it remained flat during the April-October period.

Production of coal,crude oil and steel also showed some growth during the month.

Coal production grew 2.3 per cent compared to a contraction of 3.9 per cent in October and a contraction of 2.9 per cent year-on-year.

Crude oil production grew 1.1 per cent during the month compared to a contraction of 0.8 per cent last month while steel output grew 3.9 per cent in November as against 3.5 per cent in the previous month.

GROUP OF EIGHT

* The core sector comprises eight industries — crude oil,coal,natural gas,fertilisers,steel,cement,electricity and refinery products

* This group has a weightage of 37.90% in the IIP

* Cumulative growth during the April-November period was 2.5% compared to 6.7% year-on-year.

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