The growth rate of eight infrastructure sectors – coal, crude oil, natural gas, refined products, fertilizers, steel, cement and electricity – was 7.6% in FY23, compared to 10 .4% recorded in 2021-22.
Coal production increased by 12.2%, fertilizers by 9.7%, steel by 8.8%, natural gas by 2.8% and refined products by 1.5%.
Output in eight infrastructure sectors grew by 3.6% in March 2023, the slowest in five months, according to government data released on Friday. Production in the basic sectors had increased by 7.2% in February 2023 and by 4.8% in the month of the previous year. The previous low was 0.7% in October 2022.
Crude oil production fell by 2.8%, electricity by 1.8% and cement by 0.8% in March this year.
On the other hand, coal production increased by 12.2%, fertilizers by 9.7%, steel by 8.8%, natural gas by 2.8% and refined products by 1. 5%.
The growth rate of eight infrastructure sectors – coal, crude oil, natural gas, refined products, fertilizers, steel, cement and electricity – was 7.6% in FY23, compared to 10 .4% recorded in 2021-22.
The core sector or key infrastructure industries have a weighting of 40.27% in the overall Index of Industrial Production (IPI).
Aditi Nayar, Chief Economist and Head (Research and Outreach) at CIFAR, said: “The halving of core sector year-on-year growth to a five-month low of 3.6% in March 2023 from 7.2% in February 2023, was fairly broad-based, with only coal and crude oil showing sequential improvement.”
She added that production in some sectors was likely held back by unseasonal rainfall, such as electricity and cement, which posted a year-on-year contraction in March 2023 along with crude oil. At the same time, coal, fertilizers and steel posted a healthy expansion of more than 8% in March 2023, which is encouraging.
“Dampened by high base and heavy rainfall, the year-over-year performance of most available high-frequency indicators weakened in March 2023, compared to February 2023, similar to the trend in the base sector. As a result , ICRA expects annual PII growth to drop to 3-4% in March 2023,” Nayar said.
(With PTI entries)
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