The growth of eight core sectors declined to 2.5% in April mainly due to lower coal, crude oil and cement productions, revealed government data.
The growth rate of eight infrastructure sectors — coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity — was 8.7% in April last year. As per the government data released on Wednesday, coal, crude oil and cement production recorded negative growth of 3.8%, 0.6% and 3.7%, respectively.
Slow growth in key sectors would also have implications on the Index of Industrial Production (IIP) number as these segments account for about 41 rpt 41% to the total factory output.
Growth in refinery products and electricity output slowed down by 0.2% and 4.7% in April as against 19.1% and 14.5%, respectively in the same period last year. However, natural gas, fertiliser and steel reported positive growth at 2%, 6.2% and 9.3%, respectively.
The commerce ministry in a statement said the base year of the index of eight core industries has been revised from 2004-05 to 2011-12. “The shift is in line with the new base year of IIP,” it said adding the number of industries remain the same as in the 2004-05 series.
“The revised basket of eight core industries is aligned to the new series of IIP (2011-12) as far as possible. The revised eight core industries have a combined weight of 40.27% in the IIP,” it added.
Former Prime Minister Manmohan Singh had warned in January that the note ban decision by the Centre’s Narendra Modi government will have adverse impact on India’s GDP.
“You will see there will be a very significant adverse effect on the country’s GDP,” he had said.
Singh, who spoke in the presence of Prime Minister Narendra Modi in Rajya Sabha, said the decision will result in decline of GDP by 2 per cent, it being an “under-estimate”.
“These measures convinced me that the way the scheme has been implemented, it’s a monumental management failure. And in fact, it is a case of organised loot and legalised plunder,” he had said.