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New Delhi, Oct 3: Helped by robust performance of coal, natural gas and electricity, the eight core sectors recorded a five-month high growth rate of 4.9 per cent in August, official data showed Tuesday.
These eight infrastructure sectors — coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity — had witnessed 3.1 per cent expansion in August last. The infrastructure growth was 2.6 per cent in July. The core sector growth in August is the highest since March, when it grew by 5.2 per cent.
The production of coal, natural gas and electricity rose by 15.3 per cent, 4.2 per cent and 10.3 per cent, according to the official data released Tuesday. However, crude oil, fertiliser and cement recorded negative growth in the month under review. The production growth of refinery products and steel slowed down to 2.4 per cent and 3 per cent in August as against 2.5 per cent and 16.7 per cent respectively in the same month last year.
Cumulatively, the eight core sectors in April-August recorded a growth rate of 3 per cent as against 5.4 per cent in the same period a year ago.Healthy growth in key sectors would have positive implications on the Index of Industrial Production (IIP) — which is the macro-gauge for India’s factory output — as the Index of Eight Core Industries (ECI) carries 40.27 per cent weightage and account for about 41 per cent of the total factory output.
Commenting on the data, rating agency ICRA said: “Given the favourable base effect and the expected rebuilding of inventories prior to the festive season, we expect the IIP (index of industrial production) growth to improve in August relative to the initial estimate of 1.2 per cent for July 2017”.
“The combined ECI indes stands at 123.6 in August, 2017, which was 4.9 per cent higher compared to the index of August, 2016,” the Ministry of Commerce & Industry said in the summary of the ECI for August.