The key eight infrastructure industries grew 3.2 per cent in September, fastest in four months, due to robust performance by sectors including fertilisers and electricity generation even as all other sectors performed dismally.
The eight core sector industries including coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity had grown 2.6 per cent during the same period last year. During the month, fertiliser production grew 18.1 per cent compared to 12.59 per cent in August and -11.6 per cent in September 2014. Electricity generation also witnessed a growth of 10.8 per cent during the month compared to 5.6 per cent last month and 3.9 per cent in the same period last fiscal.
However, economists said that the growth in the core sector offers little solace. “The uptick in core sector growth offers little solace as it comes on the back of a favourable base effect for fertilisers and electricity, both of which recorded double digit growth during the month under review. Moreover, disaggregated trends are discouraging, with three of the constituents (steel, cement, crude oil) recording a contraction and another three (coal, natural gas and refinery products) displaying sub-2 per cent growth,” Aditi Nayar, senior economist, ICRA, said.
Electricity generation benefited from the improvement shown in domestic coal production along with a favourable base effect.
The coal sector output grew 1.9 per cent in September compared to 0.4 per cent last month and 7.6 per cent during the corresponding month last fiscal. Steel production continued to decline, contracting -2.5 per cent as compared to -5.9 per cent in the previous month. The sector had shown a growth of 6.6 per cent in September 2014. Production of crude oil also contracted -0.1 per cent as compared to 5.6 per cent in August. With regards to natural gas, it grew just 0.9 per cent compared to 3.7 per cent in August and -5.8 per cent in September 2014.
The core sector comprises nearly 38 per cent of index of industrial production (IIP).