India’s core sector, comprising industries such as coal, electricity, steel, and cement, posted a 6.1 per cent growth in July after having slowed to 4 per cent in June, according to data released by the Commerce Ministry today (August 30).
The growth rate of the 8 core sector industries, for the first four months of the current financial year (2024-25), now works out to 6.1 per cent compared with 6.6 per cent during the same of the previous year. The growth in steel production rose to a three-month high of 7.2 per cent in July, compared with 6.7 per cent in the previous month.
Cement output rose to a four-month high of 5.5 per cent from 1.9 per cent in the previous month, reflecting a pick-up in construction activity. Petroleum production rose to an eight-month high of 6.6 per cent, while fertiliser output was at a seven-month high of 5.3 per cent as kharif sowing gathered momentum due to a better monsoon this year. The coal industry output increased by 6.8 per cent while electricity generation increased by 7.0 per cent in July.
Crude oil production continued to contract in April, while natural gas output also declined during the month.
The summary of the index of 8 core industries is given below:
1. Cement
Cement production (weight: 5.37 per cent) increased by 5.5 per cent in July, 2024 over July, 2023. Its cumulative index increased by 1.6 per cent during April to July, 2024-25 over corresponding period of the previous year.
2. Coal
Coal production (weight: 10.33 per cent) increased by 6.8 per cent in July, 2024 over July, 2023. Its cumulative index increased by 9.9 per cent during April to July, 2024-25 over corresponding period of the previous year.
3. Crude Oil
Crude Oil production (weight: 8.98 per cent) declined by 2.9 per cent in July, 2024 over July, 2023. Its cumulative index declined by 1.3 per cent during April to July, 2024-25 over corresponding period of the previous year.
4. Electricity
Electricity generation (weight: 19.85 per cent) increased by 7.0 per cent in July, 2024 over July, 2023. Its cumulative index increased by 9.9 per cent during April to July, 2024-25 over corresponding period of the previous year.
5. Fertilizers
Fertilizer production (weight: 2.63 per cent) increased by 5.3 per cent in July, 2024 over July, 2023. Its cumulative index increased by 1.3 per cent during April to July, 2024-25 over corresponding period of the previous year.
6. Natural Gas
Natural Gas production (weight: 6.88 per cent) declined by 1.3 per cent in July, 2024 over July, 2023. Its cumulative index increased by 4.3 per cent during April to July, 2024-25 over corresponding period of the previous year.
7. Petroleum Refinery Products
Petroleum Refinery production (weight: 28.04 per cent) increased by 6.6 per cent in July, 2024 over July, 2023. Its cumulative index increased by 2.3 per cent during April to July, 2024-25 over corresponding period of the previous year.
8. Steel
Steel production (weight: 17.92 per cent) increased by 7.2 per cent in July, 2024 over July, 2023. Its cumulative index increased by 7.6 per cent during April to July, 2024-25 over corresponding period of the previous year.
The Finance Ministry is upbeat about the outlook ahead. Its monthly report for July states that on balance, India’s economic momentum remains intact. Despite a somewhat erratic monsoon, reservoirs have been replenished. Manufacturing and services sectors are expanding, according to the Purchasing Managers’ indices. Tax collections- especially indirect taxes, which reflect transactions- are growing healthily, and so is bank credit, according to the review.
Inflation is moderating, and exports of both goods and services are doing better than they did last year. Stock markets are holding on to their levels. Foreign direct investment is looking up as gross inflows are rising, the review states.
