The output of eight core industries grew 3.7 per cent in January 2022, higher than 1.3 per cent in same month last year. The latest core industries growth print was, however, lower than 4.1 per cent in December 2021, official data released on Monday showed.
Core sector growth
The government has also now revised the core sector growth for October 2021 to 8.7 per cent.
The Centre has also said that core industries’ output for April-January 2022 grew 11.6 per cent, compared to contraction of 8.6 per cent in the same period in the previous fiscal.
Meanwhile, in January, six of the eight core industries recorded output growth on a year-on-year basis. Only crude oil and fertilizers recorded contraction at 2.4 per cent and 2 per cent, respectively.
The sectors that saw positive growth are coal (8.2 per cent); natural gas (11.7 per cent); refinery products (3.7 per cent): steel (2.8 per cent); cement (13.6 per cent) and electricity (0.5 per cent).
Coal, natural gas and refinery products have tended to show consistency in growth rates in the last few months. Cement has clocked two successive growth rates of above 14 per cent due to the infra push in construction seen in the economy.
Madan Sabnavis, Chief Economist, Bank of Baroda, said that the volatility seen in core sector growth is expected to continue in the coming months. “IIP growth can be expected to be around 3 per cent based on uptick in consumer goods to an extent along with base effect,” he said.
Aditi Nayar, Chief Economist, ICRA, said that the third wave had an expectedly muted impact on India’s core sectors in January 2022, with the pace of growth slipping mildly to 3.7 per cent in that month from 4.1 per cent in December 2021.
“The industrial sector appears to have escaped relatively unscathed from the third wave, with a muted dip in the y-o-y growth of the core sector as well as the mild sequential decline in the daily average generation of GST e-way bills. With an easing of the unfavourable base effect, we expect IIP growth to rise to 1.0 per cent in January 2022 from the initial estimate of 0.4 per cent for December 2021”, she said.