India’s eight core sector industries recorded a 4% year-on-year growth in December 2024, driven by increased production in coal, steel, and electricity, according to government data released on Friday.
The core industries include coal, natural gas, crude oil, refinery products, fertilizers, cement, steel, and electricity, comprising 40.27% of the Index of Industrial Production (IIP). The growth rate of these industries serves as an indicator of overall industrial growth.
With the exception of natural gas, all sectors registered growth in December 2024. The performance of key sectors was as follows: coal (5.3%), refinery products (2.8%), crude oil (0.6%), fertilizers (1.7%), cement (4%), steel (5.1%), and electricity (5.1%).
For the April-December 2024 period, core sector growth stood at 4.2%, compared to 8.3% in the corresponding period of 2023. Experts attribute the decline to a high base effect and weaker performance in some sectors.
ICRA Chief Economist Aditi Nayar noted that core sector growth eased to 4.0% in December 2024 from a revised 4.4% in November 2024. Four of the eight sectors recorded weaker performance compared to the previous month. However, the growth rate remained in line with the average of 4.0% seen during October-November 2024.
Nayar projected that IIP growth in December 2024 would moderate to 3-5%, compared to 4.4% in December 2023, partly due to an unfavorable base effect.
Bank of Baroda Chief Economist Madan Sabnavis stated that the moderation in core sector growth was due to lower growth in five out of the eight segments. However, power (5.1%), cement (4%), and crude oil, which turned positive from negative growth last year, performed better.
Sabnavis estimated that IIP growth for December 2024 would be in the range of 4-4.5%, supported by the consumer goods segment.
-IANS
