On a month-on-month basis, output in October was up 7.3% compared to the seven-month low of September for the index of eight core industries.
Production from India’s eight core sectors rose 7.5% in October, picking up pace with the revised 4.5% growth estimate for September, with all sectors except crude reporting positive growth.
On a month-on-month basis, output in October was 7.3% higher than the seven-month low of September for the index of eight core industries. These sectors account for 40.27 per cent of the weight of the items included in the Index of Industrial Production (IIP).
Steel production growth hit an 11-month low of 0.9%, marking a streak of declining growth for four consecutive months. Compared to September 2021, however, production had increased by 3.7%.
Crude oil production, which has been shrinking continuously for several months now, fell 2.2% compared to October 2020, but grew by 2.85% on a sequential basis from September 2021.
The year-on-year growth in fertilizer production remained positive for the second consecutive month, but at only 0.04%. However, compared to September, there was a healthy growth of 8.2% in fertilizer production.
Natural gas and refinery products posted healthy growth of 25.8% and 14.4% respectively, but thanks largely to a base effect of negative growth of 8.6% and 17% in October 2020.
Coal and cement production registered a growth of 14.6% and 14.5% respectively. Electricity generation grew 2.8% year over year, but fell 0.8% compared to September 2021.
“The difference in double-digit growth in cement with marginal growth in steel reflects a cut in auto production, while construction activity appears to be healthy,” said Aditi Nair, chief economist, ICRA.
The overall growth of 7.5% is ‘exceeding expectation’ and is encouraging, even though it is not broad based, he pointed out, attributing the accelerating growth in petroleum refinery products to increasing dynamism, and the ramping up of coal as well as cement. and power generation.
While core sector growth has picked up and festive season trends were broadly positive, a 22% contraction in auto production is likely to push October 2021 IIP growth below 2.5%, Ms Nair said, adding to the growth of core sectors as well. Is. It is likely to slip below 5% in November.
,