Core industry growth slows to 3.1% in Dec

In a poor performance, the eight core industries grew by 3.1% in December mainly due to slackening output of crude oil, steel and natural gas.

The eight core industries, which include coal, cement, natural gas, petroleum refinery and fertilisers, had recorded a growth rate of 6.3% in December 2010.

This is the second lowest growth rate of the core industries in 2011-12 after October when the infrastructure sectors had expanded by just 0.3%.

For the April-December this fiscal, the growth was lower at 4.4% compared to 5.7% in the corresponding period of 2010-11 in wake of deceleration in investment.

The eight industries together contribute 37.9% in the overall Index of Industrial Production (IIP).

As per the data released by Commerce and Industry Ministry, crude oil production contracted by 5.6% in December against 15.8% in the same month last year.

Natural gas production too contracted by 10.8% against (-)0.2% year-on-year.

In December, the petroleum refinery output slowed to 0.8% (from 8.3%) and steel to 2.2% (from 9.4%).

On the other hand, coal output was up by 5.6% in December this fiscal from 3.8% year-on-year.

Fertilisers segment expanded by 0.8% (from 0.3%), cement by 13.3% (from minus 2.2%) and electricity by 8% (from 5%).

Concerned over slowing economic activities in the country, Finance Minister Pranab Mukherjee in Chicago had said one of the key objective in the current year is to rejuvenate the markets and improve the business sentiments which have been at low levels for most of the last year.

As per a latest CII survey, the Business Confidence Index (BCI) in the country declined by five points to 48.6 during the October-December quarter.