The growth rate of eight crucial sectors within the infrastructure industry has experienced a slowdown, reaching a four-month low of 8.1% in September 2023. This figure is lower compared to the 8.3% growth rate recorded in the same period last year, according to official data released on Tuesday.
Among these eight sectors, the output of refinery products, fertilizers, cement, and electricity experienced a deceleration in growth, while crude oil output saw a negative growth rate.
It is worth noting that these eight industries contribute to 40.27% of the Index of Industrial Production (IIP). The lowest growth rate prior to this was recorded in May, at 5.2%.
In September, crude oil output decreased by 0.4% compared to a contraction of 2.3% in the corresponding month of the previous year, as indicated by the data.
In August, the core sector witnessed a growth rate of 12.5%, the highest since June 2022, when it reached 13.2%.
Furthermore, the output growth of these eight sectors was lower at 7.8% in April-September 2023-24, in contrast to 9.8% in the same period a year ago.
In September, coal, natural gas, and steel production experienced growth rates of 16.1%, 6.5%, and 9.6%, respectively.
Similarly, the growth rates in the production of refinery products, fertilizers, cement, and electricity during September this year were 5.5%, 4.2%, 4.7%, and 9.3%, respectively. These figures represent a decline compared to the corresponding figures of 6.6%, 11.8%, 12.4%, and 11.6% recorded last year.
Aditi Nayar, Chief Economist at Icra Ltd, stated that the core sector expansion in September reached a four-month low of 8.1% due to an expected pickup in rainfall. She noted that the growth in seven out of the eight constituent sectors, excluding fertilizer output, slowed down.
She further commented on the sharp deceleration of cement production, reaching a six-month low of 4.7% in September. Nayar speculated that the IIP growth is likely to moderate to high single digits in September, following the trajectory of the core sector.
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