The core sector comprising coal, crude oil, steel, cement, electricity, fertilisers, refinery products and natural gas industries had grown 8.5% in July 2023.
Excluding crude oil and natural gas, all industries reported an increase in output in July, showed the data released by the commerce and industry ministry. “The production of Steel, Electricity, Coal, Refinery Products, Cement, and Fertilizers recorded positive growth in July 2024,” the ministry said in a statement.
Crude oil production shrank 2.9% in July and natural gas was down 1.3%. Refinery output increased 6.6%, coal 6.8% and fertiliser was up 5.3%. Fertilizers growth indicates companies are building stocks for use for both kharif and rabi.
Infra activity on the government side picked up which resulted in steel and cement growing by 7.2% and 5.5%, respectively which came over high base year growth rates.
“Post elections there has been a pick-up in road construction in particular. The good performance of housing and auto also added to demand for steel,” said Madan Sabnavis, chief economist, Bank of Baroda.
Power generation was up 7% on July, which had backward link to coal that grew 6.8%. This is an indication of heightened business activity as July saw good rains and the ‘heatwave’ effect was minimal.
Cumulatively, growth rate in output of the eight core industrial sectors slowed to 6.1% in the first four months of FY25 from 6.6% in the previous fiscal. These sectors have a 40.27% share in the country’s Index of Industrial Production (IIP).
Industrial production is expected to grow at a steady rate in July and would be around 6%. IIP grew 4.2% in June.
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