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Production of the eight core sector industries grew by only 1.6 per cent in January against 2.1 per cent in December, pulled down by coal, petroleum refinery products and natural gas, official data showed on Friday.
Since the core sector has roughly 28 per cent in the Index of Industrial Production, the data showed factory production might remain subdued in January as well. Industrial production had declined for three months in a row till December.
Even at 2.1 per cent growth in the core sector, there was a 0.6 per cent contraction in industrial production in December. If industrial production does not recover in January and the trend persists in February and March, overall economic growth might fail to recover in the fourth quarter as well. The economy grew below five per cent in September-December for a seventh quarter in a row.
The extent of problems in the core sector – fertilisers, cement, steel, electricity, crude oil, coal, petroleum refinery products and natural gas – can be gauged from the fact that it grew 8.3 per cent in January 2013.
In contrast, the growth was 2.4 per cent during the April-January period of this financial year, compared with 6.9 per cent in the same period of 2012-13.
Coal output contracted 0.7 per cent in January. Petroleum refinery production fell 4.5 per cent and natural gas output by 5.2 per cent. Steel output growth slowed to 3.4 per cent, while expansion in cement production eased to 1.5 per cent. Crude oil registered growth of three per cent and electricity generation expanded 5.7 per cent.
