Growth of 8 core sectors has slowed down

Growth of eight core industries has dropped to 2.1% in July, mainly due to contraction in coal, crude oil and natural gas production as per the government data.

The eight core sector industries — coal, crude oil, natural gas, refinery products, fertiliser, steel, cement and electricity — had been expanded by 7.3% in July 2018.

These core industries comprises of 40.27% of the weight of items included in the Index of Industrial Production (IIP).

Output of coal, crude oil, natural gas and refinery products have recorded negative growth during the month under review.

Similarly, growth rate in production of steel, cement and electricity has also declined to 6.6%, 7.9% and 4.2%, respectively, as against 6.9%, 11.2% and 6.7%.

However, fertiliser output has marginally grew by 1.5% in July as against 1.3% in July 2018.

For April-July period, the eight sectors growth rate has almost halved to 3% as compared to 5.9% in the same period last year.

The growth rates of these eight sectors have been declining since April this year. It also slowed down to 5.2% in April from 5.8%. It came down to 4.3% in May and 0.7% in June. The GDP data has also shown deceleration with the growth rate coming down to over six year low of 5% in the first quarter of the current fiscal, mainly on account of sharp dip in manufacturing sector, which has registered almost a flat growth of 0.6%.

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