Home / Economy / Core sector growth slows to 9-month low of 3.3% in August

New Delhi: The output of eight core infrastructure sectors grew 3.3% in August, the lowest in nine months, as against 12.2% in the year ago period, the commerce ministry said on September 30.

Output in six of the eight core sectors --coal, refinery products, electricity, fertilisers, cement and steel--grew in August, according to official data released on Friday.

According to the commerce ministry, the production growth of eight infrastructure sectors was 9.8% during April-August this fiscal, compared to 19.4 per cent a year ago.

“Final growth rate of Index of Eight Core Industries for May 2022 is revised to 19.3% from its provisional level 18.1%. The growth rate of ICI during April-August 2022-23 was 9.8% (P) as compared to the corresponding period of last FY," the ministry said in a statement.

Core sector has registered a slowdown in growth rate for the third successive month to 3.3% in August. This has been influenced partly by the statistical base effect of 12.2% growth last year, said Madan Sabnavis, chief economist, Bank of Baroda.

Meanwhile, production of coal rose 7.6% year-on-year in August, and electricity generation rose 0.9%, said the commerce ministry.

“Mining has done well at 7.6% which comes on top of 20.6% growth last year. Power sector growth was just 0.9% which is understated due to strong growth of over 16% last year. Return to normalcy in coal production is a positive for the economy which was under stress in April and May following the Ukraine war where there was shortage of coal," Sabnavis said.

Petroleum refinery production output rose 7% while fertilisers grew 11.9% in August from a year earlier, it said.

According to the ministry, crude oil production declined by 3.3% in August, 2022 over August, 2021. While, the natural gas production declined by 0.9% in August, 2022 over August, 2021.

Steel production increased by 2.2% in August, 2022 over August, 2021. Its cumulative index increased by 5.8% during April to August, 2022-23 over the corresponding period of previous year, the ministry said.

Cement production increased by 1.8% in August, 2022 over August, 2021. Its cumulative index increased by 10.6% during April to August, 2022-23 over the corresponding period of previous year, according to official data released.

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