Core sector growth up 3.2% in August

Massive growth in steel sector pushes up index but coal output plummets

Core sector output rose 3.2 per cent in August mainly due to a record growth from the steel sector. The index had grown 3 per cent in the previous month. Data released by the Commerce and Industry Ministry on Friday showed growth in the eight core industries had a cumulative growth of 4.5 per cent in the months leading up to August in the current financial year.

Core sector output rose 3.2 per cent in August mainly due to a record growth from the steel sector. The index had grown 3 per cent in the previous month.

Data released by the Commerce and Industry Ministry on Friday showed growth in the eight core industries — coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity — had a cumulative growth of 4.5 per cent in the months leading up to August in the current financial year.

Comprising nearly 38 per cent of industrial production, the sectors had a lower growth of 2.4 per cent in the year-ago period. While, two sectors saw a double-digit growth in June, only steel production rose 17 per cent. This is the highest growth in steel production in more than two years.

Coal output saw contraction of 9.2 per cent. Coal production had grown for 10 of the last 12 months, peaking in June with a 12 per cent rise. However, the rate of growth had been slowing since, with 5.1 per cent growth in July.

Among other sectors, natural gas and crude oil production contracted. Natural gas was down 5.7 per cent after rising 3.3 per in July. However, crude oil production continued to contract for a sixth month in August. The rate of fall also accelerated to 3.9 per cent from 1.8 per cent in July.

Refinery product output was hit severely with the rate of growth dropping to 3.5 per cent from 13.7 per cent in July.

Fertilisers had the second highest growth rate, rising 5.7 per cent. After consistently providing a major push to the index for the most part of the past financial year, sectoral growth had slowed to 2.5 per cent in July, after rising 9.8 per cent in June.

Electricity generation rose 0.1 per cent, the slowest in 9 months. It had grown by a marginal 1.6 per cent in July.

Cement production continued to swing. It rose 3.1 per cent, higher than the 1.4 per cent rise seen in July. However, growth had been 10.3 per cent in June.

Core sector growth had moderated to 3.2 per cent in July after 5.2 per cent rise in June. Growth had risen to a 17-month high of 8.5 per cent in April due to rise in refinery products and electricity generation, but the sectors failed to sustain the growth momentum.