Core sector output declines by 0.5%

New Delhi: The eight core industries in August recorded a 0.5 per cent decline in output of coal, crude oil, natural gas, cement, and electricity, according to a government data released on Monday.

The eight core sector industries — coal, crude oil, natural gas, refinery products, fertiliser, steel, cement and electricity - had expanded by 4.7 per cent in August last year.

Coal, crude oil, natural gas, cement, and electricity recorded a negative growth of 8.6 per cent, 5.4 per cent, 3.9 per cent, 4.9 per cent and 2.9 per cent, respectively, in August, according to the data of the Commerce and Industry Ministry.

However, fertiliser and steel production grew by 2.9 per cent, and 5 per cent, respectively during the month under review.

During April-August, growth in the eight core industries grew by 2.4 per cent from 5.7 per cent in the year-ago period.

"Slow demand has also led to an increase in the inventory of semis products.

A substantial pick up in the consumer demand and government and private sector spending is required to arrest the fall in demand," research firm India Ratings said.

It has cut the domestic crude steel production outlook to 4 per cent from 7.5 per cent recorded last financial year.

The average domestic spreads over April-August 2019 period were well below the average 2018-19 levels signifying a likely fall in margins of domestic steel players in the first half of this fiscal. However, with raw materials playing catch-up, the spreads are likely to improve in the second half.,