Core growth plunges to 5.3% in November
The decline in growth rate of crude petroleum, petroleum refinery products, cement and carbon steel has pulled down the growth of the six infrastructure industries to 5.3% in November 2007.
By TNN |
NEW DELHI: The decline in growth rate of crude petroleum, petroleum refinery products, cement and carbon steel has pulled down the growth of the six infrastructure industries to 5.3% in November 2007, compared to 9.6% in the corresponding period of the previous year.
According to commerce ministry’s monthly statement, released on Tuesday, crude oil production rose by 0.3% in November compared to a growth rate of 9.8% in November 2006. Petroleum refinery production grew by 5.2% compared to 16.4% last year. Electricity generation grew by 5.8% against 8.8%.
Cement production registered a growth of 4.5% compared to 11.8%. Finished steel output grew by 5.8% compared to 9.3%. Coal production expanded by 7.7% against 4.9% in November 2006.
For the April-November period of the current fiscal, the growth for the key sectors — steel, cement, power, crude oil and refinery — dropped to 6% from 8.9% in the year-ago period, according to the data.
Experts contacted by ET pointed out that since the infrastructure sector was showing robust growth, the deceleration in the core sector was puzzling. Further, since the six core industries have a combined weight of 26.7% in the Index of Industrial Production (IIP), it would have a negative impact on IIP figures.
National Statistical Commission chairman Suresh Tendulkar said: “The slowdown in core sector represents the production of the goods used as input in developing physical infrastructure of the country such as roads, ports and airports. As the infrastructure sector is showing robust growth, it is hard to find out why there is a slowdown.”
HDFC bank chief economist Abheek Barua said it was hard to tell what could be the reason behind the slowdown in core infrastructure sector growth but as it accounted for 27% of IIP it could have impact on IIP numbers in November 2007 which are yet to come.
According to commerce ministry’s monthly statement, released on Tuesday, crude oil production rose by 0.3% in November compared to a growth rate of 9.8% in November 2006. Petroleum refinery production grew by 5.2% compared to 16.4% last year. Electricity generation grew by 5.8% against 8.8%.
Cement production registered a growth of 4.5% compared to 11.8%. Finished steel output grew by 5.8% compared to 9.3%. Coal production expanded by 7.7% against 4.9% in November 2006.
For the April-November period of the current fiscal, the growth for the key sectors — steel, cement, power, crude oil and refinery — dropped to 6% from 8.9% in the year-ago period, according to the data.
Experts contacted by ET pointed out that since the infrastructure sector was showing robust growth, the deceleration in the core sector was puzzling. Further, since the six core industries have a combined weight of 26.7% in the Index of Industrial Production (IIP), it would have a negative impact on IIP figures.
National Statistical Commission chairman Suresh Tendulkar said: “The slowdown in core sector represents the production of the goods used as input in developing physical infrastructure of the country such as roads, ports and airports. As the infrastructure sector is showing robust growth, it is hard to find out why there is a slowdown.”
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HDFC bank chief economist Abheek Barua said it was hard to tell what could be the reason behind the slowdown in core infrastructure sector growth but as it accounted for 27% of IIP it could have impact on IIP numbers in November 2007 which are yet to come.
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