Continuing the upward trend, the eight core industries grew by 6.8 per cent in November 2017, compared to the production during November 2016.
According to data shared by the Ministry of Commerce, this has been the highest year-on-year growth registered in the current financial year.
The 6.8 per cent growth in November 2017 out-paces the previous high of 5-per-cent growth reported during the sequential month (October 2017).
The growth in November was driven by a 16.6 per cent increase in steel production over November 2016.
Cement production too increased by 17.3 per cent in November 2017 over same month in 2016.
Core sector growth during November 2016 was hit by demonetisation and had plunged to 3.2 per cent.
According to Aditi Nayar, Vice-President and Principal Economist, at ICRA, the favourable base effect-led spike in the expansion of cement and steel contributed to the uptick in growth of the core industries to a 13-month high of 6.8 per cent in November 2017.
This was despite four of the eight industries (coal, natural gas, fertilisers and electricity) recording a sequential dip in growth. Coal was the only index that showed a year-on-year decline during November 2017. Coal production declined by 0.2 per cent during the month under consideration compared to the corresponding period of the last financial year.
Compared to November 2016, crude oil production was up by 0.2 per cent, natural gas production increased by 2.4 per cent, petroleum refinery output grew by 8.2 per cent during November 2017.
Fertiliser production increased by 0.3 per cent and electricity generation was up by 1.9 per cent during the same period.
“We expect the growth of the Index of Industrial Production (IIP) to rebound to a healthy 5-6 per cent in November 2017.
“The favourable base effect related to the temporary slowdown in activity after demonetisation, is likely to boost volume growth in a variety of sectors in the remainder of financial year 2017-18,” Nayar added.