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Eight core sectors' growth for December comes in at 3.8% vs 3.4% in November

During April-December 2021, the eight core sectors grew 12.6 percent. In April-December 2020, their output had shrunk by 9.8 percent.

January 31, 2022 / 08:04 PM IST
Representative image

Representative image

India's eight core sectors grew by 3.8 percent in December 2021 compared to 3.4 percent in November 2021, the government said on January 31.

According to data provided by the commerce ministry, coal output rose by 5.2 percent, while that of refinery products increased by 5.9 percent.

The increase in output in December 2021 was largest for natural gas, which posted an increase of 19.5 percent. Cement followed closely, with its output rising 12.9 percent.

Production of fertilisers and electricity increased by 3.5 percent and 2.5 percent, respectively.

The two sectors which saw a contraction in their output were crude oil and steel. While crude oil output fell 1.8 percent, steel production declined 1.0 percent.

During April-December 2021, the eight core sectors grew 12.6 percent. In April-December 2020, their output had shrunk 9.8 percent.

While the core sector growth figure for December 2021 is higher than that recorded in November 2021, it continues to lag the 8.4 percent increase witnessed in October 2021.

"Similar to the eight core industries, the December 2021 year-on-year performance of many high frequency indicators has trailed the respective growth recorded in October 2021," noted Aditi Nayar, ICRA's Chief Economist.

As such, Nayar expects industrial growth, as per the Index of Industrial Production (IIP), to again come in under 2.0 percent in December 2021.

The eight core industries together account for 40.3% of the total weight of the IIP. As such, the core sector growth number holds clues for what the monthly industrial growth might be.

IIP data for December 2021 is scheduled to be released on February 11. The most recent data showed industrial growth slumped to a nine-month low of 1.4 percent in November 2021.

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