India’s core sector growth slows to 3.3% in Aug; lowest in 9 months

The output of eight core infrastructure sectors grew 3.3 per cent in August — the lowest in nine months — as against 12.2 per cent in the year-ago period, according to official data released on Friday.

The previous low was in November 2021 at 3.2 per cent. It stood at 4.5 per cent in July.

The production growth of eight infrastructure sectors — coal, crude oil, natural gas, refinery products, fertiliser, steel, cement and electricity — was 9.8 per cent during April-August this fiscal, compared to 19.4 per cent a year ago.

Crude oil and natural gas production contracted by 3.3 per cent and 0.9 per cent, respectively, during the month under review.

In August, the fertiliser output rose by 11.9 per cent against a contraction of 3.1 per cent in the same month last year.

The growth rates for coal, refinery products, steel, cement and electricity slowed to 7.6 per cent, 7 per cent, 2.2 per cent, 1.8 per cent and 0.9 per cent, respectively.

Commenting on the data, ICRA Ltd Chief Economist Aditi Nayar said a normalising base and weak demand for electricity and construction activity during the heavy rains appear to have dampened the core sector growth in August 2022.

“While the record high GST e-way bills were encouraging, the low core sector growth suggests that the IIP may record a mid single digit rise in August,” she added.

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