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Growth in the eight core sectors shot up to 6.4 per cent in March 2016 (year-on-year) compared to a fall of 0.7 per cent in the same month last year, largely due to an increase in production of electricity, refinery products, fertilisers, and cement, coupled with a low base.
The performance of the core sectors during 2015-16 (April-March) was, however, much lower at 2.7 per cent compared to 2014-15, according to an official release.
The eight infrastructure sectors that make up the core sector — coal, steel, electricity, crude oil, natural gas, fertiliser, cement and refinery products — comprise nearly 38 per cent of the weight of items included in the Index of Industrial Production.
Year-end phenomenon “The infrastructure industries have witnessed a recovery for the second successive month (core sector grew 5.7 per cent in February). This does indicate some semblance of a recovery which may also largely be due to the year-end phenomenon of companies rushing to meet targets thus leading to higher production,” according to CARE Ratings.
Electricity generation (with a weight of 10.32 per cent) increased by 11.3 per cent in March 2016. Cumulatively it increased 5.2 per cent in 2015-16 over the previous fiscal.
Steel production (with the second highest weight of 6.68 per cent) increased 3.4 per cent in March, 2016 over March, 2015. During 2015-16 fiscal, steel production declined by 1.4 per cent over the previous fiscal. Petroleum refinery production (weight of 5.94 per cent) increased 10.8 per cent in March, 2016 over March, 2015. In fiscal 2015-16, production increased by 3.8 per cent over the corresponding period of the previous year.
Fertiliser production (weight of 1.25 per cent) increased 22.9 per cent in March 2016 over March, 2015. Cumulatively, fertiliser production for fiscal 2015-16 increased 11.3 per cent over 2014-15.
Cement production (a weight of 2.41 per cent) increased 11.9 per cent in March, 2016, and by 4.6 per cent for the entire fiscal of 2015-16.
Coal production (weight of 4.38 per cent) increased 1.7 per cent in March, 2016, while its performance during the entire fiscal 2015-16 was better posting an increase of 4.6 per cent.
The laggards Crude oil and natural gas were the two sectors that suffered a fall in production in March. Crude oil production (weight of 5.22 per cent) decreased 5.1 per cent during the month, while cumulatively it declined 1.4 per cent in fiscal 2015-16.
Natural gas production (weight of 1.71 per cent) decreased by 10.5 per cent in March, 2016. The decline for the entire fiscal of 2015-16 was lower at 4.2 per cent.
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