The combined June index of eight 'core' industries of the Indian economy is up 5.2 percent at 180.4 compared to the index of June last year. Its cumulative growth during April to June, 2016-17 stood at 5.4 percent versus 2.8 percent month-on-month (MoM).
The eight core industries comprise nearly 38 percent of the weight of items included in the Index of Industrial Production (IIP).
The growth was largely led by increase in production in core sector industries barring crude oil and natural gas.
While the coal sector saw the highest growth in production of 12 percent in June, 2016 over June, cement sector grew by 10.3 percent in the same period followed by 9.8 percent increase in fertilizer production.
Even electricity generation rose by 8.1 percent in the month of June as compared to last month.Despite the good numbers, there exists doubt regarding Index of Industrial Production (IIP). Speaking to CNBC-TV18, Soumya Kanti Ghosh, Chief Economic Advisor, State Bank of India, said he is skeptical of these numbers supporting IIP numbers going ahead. Backing Ghosh, Siddhartha Sanyal, Chief India Economist, Barclays Capital, said though prima-facie this is a good show, core sector numbers have been fluctuating in recent months. "Relationship between IIP and core sector is questionable; there is a bit of disconnect often between IIP and industrial GDP number," Sanyal added.
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