Core sector growth slows to 12.7% in June

Source: Reuters

India's eight core sectors grew 12.7 percent in June, slowing from an upwardly revised 19.3 percent in May, the commerce ministry said on July 29.

Output in seven of the eight core sectors grew in June. These sectors include coal, natural gas, refinery products, electricity, fertilisers, cement and steel, said the ministry.

India’s economy is recovering from the pandemic but faces headwinds such as a looming slowdown in the West and continued uncertainty due to the Russia-Ukraine war.

Meanwhile, India’s central bank has quickened the pace of its policy tightening and is expected to raise rates again next week.

The International Monetary Fund earlier this week cut its gross domestic product growth forecast for India for the current financial year by 80 basis points to 7.4 percent. The forecast for next fiscal year was also cut by a similar quantum to 6.1 percent.

Meanwhile, production of coal rose 31.1 percent year-on-year in June, and electricity generation rose 15.5 percent, said the commerce ministry.

Refinery products output grew 15.1 percent while fertilisers production gained 8.2 percent in June from a year earlier.

Cement production rose 19.4 percent while steel output gained 3.3 percent in June.

Crude oil output declined 1.7 percent from a year earlier. Natural gas output gained 1.2 percent in June.

The core sector growth for May was revised higher from 18.1 percent earlier.

The final growth rate of the index of eight core sectors for March was revised to 4.8 percent from its provisional level of 4.9 percent.

The growth rate of the eight sectors during April-June was 13.7 percent compared with the corresponding period of the last financial year.