A lower-than-expected output performance of steel and refinery products pulled down the core industries’ output growth in May to 2.3 per cent, a four-month low. In May 2013, core sector growth stood at 5.9 per cent.
In fact, this May growth was also lower than April’s 4.2-per-cent growth.
In April-May 2014, the eight core industries’ output grew 3.3 per cent.
The eight industries – coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity – account for 38 per cent of the index of industrial production (IIP).
For May, coal, fertilisers, cement and electricity sectors recorded a growth in output. However, the other four sectors – crude oil, natural gas, refinery products and steel – recorded a contraction in output year-on-year.
While coal production grew 5.5 per cent in May year-on-year, fertilisers saw 17.6 per cent growth. Cement production and electricity generation grew 8.7 per cent and 6.3 per cent, respectively. Steel output contracted 2 per cent against 22 per cent growth in same month last year. Refinery products contracted 2.3 per cent in May against growth of 4.9 per cent in same month last year.
Time for review Meanwhile, industry body Assocham said the new Government needed to initiate a comprehensive review of not only policies but also processes that govern the core industries.
In a statement, the chamber said regulatory issues linked to the fixing the price of gas had impacted the performance of the oil and gas sectors.
The Government needs to address the issue at the earliest, said Assocham Secretary-General DS Rawat.