Core sector growth rises 2.1% in Dec

Three of eight industries record production decline

Eight core industries showed a marginal increase in production growth at 2.1 per cent in December 2013 against 1.7 per cent in the previous month and a contraction of 0.6 per cent in October, official data released on Friday showed.

When seen from a year-on-year perspective, the growth was less than one-third of 7.5 per cent attained in December 2012. However, sequential rise may have a positive implication on the Index of Industrial Production (IIP), which had contracted for the second month in a row till November 2013. Core sector industries have 38 per cent weight in IIP.

Notably, two industries — natural gas and refinery products — continued to show a decline. Coal production also fell.

Natural gas production declined 9.9 per cent in December 2013 against 11.3 per cent in the previous month. Its output has been contracting at least for a year now. Refinery products’ output decreased 1.7 per cent in December 2013 against five per cent in November. Its production has been declining for the three months now.

Coal production fell 0.6 per cent against a 2.3 per cent growth in November. If this becomes a trend, then it would have repercussions on electricity generation. Electricity and to an extent fertiliser and steel were the only sectors that showed some respectable growth.

Electricity generation rose 6.7 per cent in December against 5.9 per cent in the previous month.

While fertiliser production was up 4.1 per cent against 0.6 per cent and steel increased 3.1 per cent against 3.9 per cent.

Crude oil and cement were the other two industries whose production rose, but at sub-two per cent in December. In the first nine months of the current financial year, core industries grew 2.5 per cent against 6.8 per cent in the corresponding period of 2012-13.