Core sector growth slips to a decade low of 2.6% in FY'13
New Delhi: Reflecting slowdown in the economy, the growth rate of core infrastructure industries slipped to a decade low of 2.6 percent in 2012-13 mainly on account of declining output of crude oil and natural gas.
During March, the core sector data showed a marginal deceleration to 2.9 percent from 3 percent in the same month of the previous fiscal.
For the entire 2012-13, the growth rate of eight core sector industries halved to 2.6 percent from 5 percent in 2011-12, according to the data released by the Commerce and Industry Ministry Tuesday.
The industries - crude oil, petroleum refinery products, natural gas, fertilisers, coal, electricity, cement and finished steel - have a weight of 37.9 percent in the Index of Industrial Production (IIP).
The dismal performance of core industries, according to experts, points to economic slowdown and will have implications for IIP data to be released on May 12.
"The core sectors are weak in India. Manufacturing has slowed down. It will have an impact on IIP. What we need is policy attention," Crisil Chief Economist D K Joshi said.
"The marginal decline in growth in March was on account of negative growth witnessed in the production of natural gas and low growth recorded in the production of coal and crude oil," the official said.
Production of natural gas contracted by 17.7 percent in March. Coal output growth dropped to 0.3 percent from 7.3 percent in March 2012.
Cement production growth slowed to 6.6 percent in the reported period, as against 7.1 percent in March 2012.
However, petroleum refinery, fertiliser and crude oil production grew by 5.6 percent, 3.6 percent and 0.2 percent in March 2013, as against 1.6 percent, 1.5 percent and (-) 2.9, respectively, in the year-ago period.
Steel output increased by 6.6 percent from 6.2 percent in March 2012. Electricity generation grew by 3 percent from 2.8 percent.
The growth of eight core sector industries had contracted by 2.5 percent in February, the first time in 2012-13.
The government had included natural gas and fertiliser to the core sector data making the total number to eight in 2011.
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