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Core sector growth slows to 2.7% in July

02 Sep 2014 Evaluate

Core sector output in the month of July slowed down to 2.7% from June nine-month high growth at 7.3% mainly due to decline in production of crude oil, natural gas, refinery products, fertilisers and steel. The output of eight core industries grew by 5.3% in July 2013. The eight industries - crude oil, petroleum refinery products, natural gas, fertilisers, coal, electricity, cement and finished steel - have a weight of 37.9% in the overall Index of Industrial Production (IIP).

Among core sectors, Electricity generation having 10.32% weight in IIP index registered a growth of 11.2% in July, 2014 over the same month of corresponding period. During April to July 2014-15, it recorded a growth of 11% over the corresponding period of previous year. Coal production with weightage of 4.38% in index increased by 6.2% in July, 2014 over the same period of corresponding period. On cumulative basis, coal production growth during April-July, 2014-15 increased by 5.7% compared to April-July, 2013-14. Cement sector having weightage of 2.41% respectively in IIP index, registered a growth of 16.5% respectively, in the month under review over July 2013. In cumulative terms, Cement production was recorded at 11.1% during April-July 2014-15.

On the flip side, Crude oil and Petroleum Refinery Products, with weightage of 5.22% and 5.94% in index declined by 1% and 5.5% in July, 2014 over July, 2013. In cumulative terms, Crude oil and Petroleum Refinery Products declined by 0.3 % and 2.2% during April-June 2014-15. Natural Gas production having weightage 1.71% in IIP index declined by 9% in July 2014 as compared to the month in July, 2013. The cumulative index for Natural Gas production during April-July 2014-15 declined by 5.2% over corresponding period of previous year.

Fertilizer production with weightage of 1.25% in IIP index declined 4.2% in July, 2014 over July, 2013. However, the cumulative index of Fertilizer production during April-July 2014-15 grew at 4.9% on YoY basis. Steel production (weight: 6.68%) decreased by 3.4 % in July, 2014 over July, 2013. While, its cumulative index during April to July, 2014-15 increased by 0.3% over the corresponding period of previous year.

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