Core sector growth accelerates to 6.7% in January

Core sector growth accelerates to 6.7% in January

Context:

•  Growth in the country’s core sector accelerated to 6.7% in January, 2018 from 3.4% a year ago.

Introduction:

• The growth in eight core sectors, which comprise 40.27% of the weight of items included in the Index of Industrial Production (IIP), was 4.2% in December and 7.4% in November, 2017.
• Cement output surged to 20.7% in January against 13.3% contraction in the same month a year ago, while refinery products jumped 11% in January against a flat output in January 2017.

Reason:

•  It was a huge jump in the output of cement and petroleum refinery, and a robust performance by the electricity sector.

Power generation:

• Electricity generation went up to 8.2% from 5.2% during the period under review, while coal sector output slowed to 3% from 3.5% and steel production to 3.7% from 11.3%.
•  Crude oil production shrunk to 3.2% (from 1.3% in January 2017) and fertilisers contracted by 1.6% (from -1.2%) and natural gas shrunk by 1% (from 11.6% in January, 2017).
• The cumulative growth in the core sectors during April-January this fiscal slowed to 4.3% as against 5.1% in the corresponding period last fiscal.