December 31st 2024.
In New Delhi, the official data released on Tuesday showed that the production growth of eight key infrastructure sectors has slowed down to 4.3% in November of 2024. This is a significant decrease from the 7.9% growth recorded in the same month last year. However, there is a glimmer of hope as the monthly production growth of these sectors rose to a four-month high in November.
It is worth noting that in October of 2024, the output of infra sectors had expanded by 3.7%. But in November, the production of crude oil and natural gas saw a decline. On the other hand, the growth of coal, refinery products, fertiliser, steel, and electricity also moderated compared to the same period last year.
Specifically, the growth rates of these sectors were 7.5%, 2.9%, 2%, 4.8%, and 3.8%, respectively, in November of this year. This is in contrast to the growth rates of 10.9%, 12.4%, 3.3%, 9.7%, and 5.8% recorded in November of last year. However, there was a positive development in the cement industry, as its output saw a rise of 13% in the month under review.
Looking at the bigger picture, the growth of core sectors, which include coal, crude oil, natural gas, refinery products, fertiliser, steel, cement, and electricity, was at 4.2% during the period of April to November of this fiscal year. This is a significant decrease from the growth rate of 8.7% recorded in the same period last fiscal year. These eight core sectors contribute 40.27% to the Index of Industrial Production, which measures overall industrial growth.
In response to the data, Aditi Nayar, the Chief Economist at ICRA Ltd, commented that the sequential uptick in the core sector's performance can be attributed to the sharp increase in the growth of cement output. This is likely due to a low base in the previous year. It remains to be seen how the core sector will perform in the coming months and if there will be a rebound in growth rates. Only time will tell.
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