 "Core sector grows 5.7% in February")
In what could reverse a three-month decline in industrial production, eight core sector industries surged to a 15-month high of 5.7 per cent in February, almost double the 2.9 per cent of January. These industries had expanded by 2.3 per cent in February 2015.
Official data issued on Thursday showed only one segment, steel, had a fall in February output against three — crude oil, natural gas and steel — in January.
The Index of Industrial Production (IIP), in which these industries have a weight of almost 38 per cent, contracted for November, December and January. It implies that if the remaining 62 per cent of the IIP does reasonably well, industrial production would show a high in February. However, there is not always a one-to-one relationship between core sector industries and the IIP. Many other segments, particularly capital goods, are volatile.
For instance, the core sector rose at the same rate of 3.2 per cent in September and October 2015 but the IIP rose 3.5 per cent in September and 9.9 per cent in October. Similarly, core sector industries declined in November but rose in December and January; however, IIP contracted in each of these three months.
Official data issued on Thursday showed only one segment, steel, had a fall in February output against three — crude oil, natural gas and steel — in January.
The Index of Industrial Production (IIP), in which these industries have a weight of almost 38 per cent, contracted for November, December and January. It implies that if the remaining 62 per cent of the IIP does reasonably well, industrial production would show a high in February. However, there is not always a one-to-one relationship between core sector industries and the IIP. Many other segments, particularly capital goods, are volatile.
For instance, the core sector rose at the same rate of 3.2 per cent in September and October 2015 but the IIP rose 3.5 per cent in September and 9.9 per cent in October. Similarly, core sector industries declined in November but rose in December and January; however, IIP contracted in each of these three months.
Two of the eight industries — fertiliser and cement — expanded by double-digits. The former grew 16.3 per cent and the latter by 13.5 per cent. The low base of the previous year — a contraction of 0.4 per cent in fertiliser and growth of 2.2 per cent in cement — pushed up the numbers this February. Electricity generation was just short of double-digit growth at 9.2 per cent and on a reasonably good base of 5.9 per cent.
However, its performance was volatile in recent months. It expanded by 10.8 per cent in September, declined to 8.8 per cent in October, showed zero growth in November, rose 2.7 per cent in December and six per cent in January.
Refinery products expanded by 8.1 per cent in February but that was on a low base of a one per cent contraction a year before.
