Eight core industries output increases by 4.2% in April

The core sector output in the month of April has surged mainly on the back of healthy production growth in electricity, fertilisers, cement and coal. The output growth of eight core industries grew by 4.2% in the month of April on yoy basis as compared to 2.5% in March and 3.7% recorded in the same month of previous year. 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). The core sector output in April has surged mainly on the back of high production of electricity, fertilisers, cement and coal.

Among core sectors, Electricity generation having 10.32% weight in index registered a growth of 11.2% in April, 2014 over the same month of corresponding period. Steel and Coal sectors having weightage of 6.68% and 4.38% respectively in IIP index, registered a growth of 3.1% and 3.3% respectively, in the month under review over April 2013. Cement production having 2.41% weight in IIP index increased by 6.7 % in April, 2014 over April, 2013. Fertilizer production having weightage of 1.25% in IIP index increased by 11.1% in April, 2014 over April, 2013.

On the flip side, Natural Gas production having weight 1.71% in IIP index declined by 7.7% in April 2014 as compared to April, 2013. Crude Oil production having weight of 5.22 % in IIP index declined by 0.1 % in April, 2014 over April, 2013. Petroleum refinery production, representing 5.94% weight in IIP index registered de-growth of 2.2% in April, 2014 over April 2013.

During FY14, core industries’ cumulative growth slowed to 2.7% from 6.5% in FY13. Over the past two fiscal years, Indian economy is struggling with slowdown and the factors like high interest rates, low investments and slow execution of infrastructure projects have been impacting economy’s growth. India's economic growth stayed below 5 percent for the second year in a row at 4.7 percent during FY14 mainly owing to the decline in manufacturing and mining output. The growth in manufacturing sector declined by 0.7% yoy in FY14 compared with de-growth of 0.2% in FY13 on account of weak domestic demand. The mining and quarrying sector, which suffered the brunt of policy delays, shrank 1.4% yoy in FY14.