India’s core sector output up by 3.1% in October; the best performance in three months

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Output in India’s eight core infrastructure sectors, that constitute a tad over 40% of industrial production, recovered to rise 3.1% in October, the best performance in three months in terms of growth as well as absolute output levels.

The Index of Core Industries (ICI) which had slumped to a 10-month low in September, recovered 3.9% on a sequential basis to a provisional number of 161.3 in October. The Commerce and Industry Ministry also revised upwards the core sectors’ growth in September to 2.4% from a previously estimated 2%. This was preceded by a 1.6% contraction in the index in August, the first such shrinkage in three and a half years.

Six of eight sectors recorded an uptick in October, led by coal which grew at a four-month high pace of 7.8%. Refinery products grew 5.2%, a tad slower than the 5.8% rise in September, while Steel grew at the fastest pace in three months at 4.2%.

Electricity generation grew 0.6% from last October, inching up from September’s 0.5% year-on-year growth. However, generation levels were the lowest in seven months in absolute terms.

However, barring electricity, the other seven core sectors recorded a sequential rise in their absolute output levels, with steel production at a seven-month high, and cement and coal at four-month peaks.

Cement production grew 3.3% in October, while fertilisers output rose a mere 0.4%, the slowest in five months.

Natural Gas production contracted year-on-year for the fourth straight month, declining 1.2% in October. Crude oil output also tanked for the sixth month in a row, with October recording the sharpest decline of 4.8% in this six-month streak.