Core sector growth down to 4.3% in May

The growth of eight key infrastructure sectors slowed down to 4.3 per cent in May 2023 due to a decline in the production of crude oil, natural gas and electricity, according to the data released by the government on Friday.

The core sector growth was 19.3 per cent in May 2022, while in April 2023, the key infra sectors recorded a growth rate of 4.3 per cent. During April-May this fiscal, the output growth of these eight sectors slowed down to 4.3 per cent against 14.3 per cent in the year-ago period, the data showed. Aditi Nayar, Chief Economist, Head - Research & Outreach, Icra Ltd, said the growth remained broadly stable in May. "Icra expects the YoY (year-on-year) IIP (index of industrial production) growth to print at about 4-6 per cent in May 2023," she said. The eight core industries comprise 40.27 per cent of the weight of items included in the IIP. The output of crude oil contracted by 1.9 per cent during the month under review.

Similarly, the production of natural gas and electricity dipped by 0.3 per cent each in May. The growth rate of the coal output declined to 7.2 per cent in May against 33.5 per cent in the same month last year. The growth rate in the output of refinery products too declined to 2.8 per cent in May against 28 per cent a year ago.

The rate of growth in the production of fertiliser, steel and cement slowed down to 9.7 per cent, 9.2 per cent and 15.5 per cent, respectively, in May this year compared to 22.9 per cent, 15.1 per cent and 26.2 per cent in May 2022.