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The output of the six core infrastructure industries grew by a healthy 7.1 per cent in January, leading some economists to predict a positive impact on overall factory output during the month.
The growth was mainly driven by the healthy performance of the crude oil, petroleum refinery products and electricity sectors, according to data released by the Industry Ministry today.
The output of the six core industries – crude oil, petroleum refinery products, coal, electricity, cement and finished steel – grew by 9.8 per cent in January 2010.
Positive impact
According to economists, the healthy growth in the month under review will have a positive impact on the January Index of Industrial Production (IIP) numbers, which are likely to be released this month.
“It (the January figures) will have a positive impact on overall January industrial growth,” credit ratings agency Crisil Principal Economist, Mr D.K. Joshi, said.
Yes Bank Chief Economist, Ms Shubhada Rao, concurred with this view.
“The better core sector numbers would definitely support the IIP in January,” she said.
On the other hand, the FICCI Director-General, Mr Rajiv Kumar, did not see the growth in core sector output having a significant influence on the overall industrial production numbers.
Infrastructure industries
The core infrastructure industries have a weight of 26.7 per cent in the Index of Industrial Production (IIP).
During the April-January period of the current fiscal, the six core industries registered a growth of 5.6 per cent, compared with 5.5 per cent expansion in the same period last year.
Petroleum refinery and crude oil output grew by 8.7 per cent and 10.8 per cent in January from 3.8 per cent and 9.8 per cent, respectively, in the same period last year.
Electricity generation grew by a healthy 9.3 per cent (6.4 per cent) in the month under review.
However, coal output contracted by 1.2 per cent in January 2011, in contrast to 5.4 per cent expansion in the corresponding period last year.
Growth in cement production slowed to 1.8 per cent in the month under review from 12.4 per cent in January 2010.
Growth in finished steel production also slowed to 8.2 per cent (16.8 per cent) in January 2011.
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