New Delhi : A favourable base effect, along with higher production of steel and cement gave a boost to India’s industrial output in November 2017, according to government data published on Monday.
On a sequential basis, the “Index of Eight Core Industries” (ECI) for November grew by 6.8 per cent from 5 per cent reported for October. Similarly, on a year-on-year (YoY) basis, the ECI which represents the output of major sectors like coal, steel, cement and electricity showed an uptrend. It had only risen by 3.2 per cent in the corresponding month of 2016.
According to the data furnished by the Ministry of Commerce & Industry, the cumulative growth of the combined ECI during April to November 2017-18 was 3.9 per cent from a rise of 5.3 per cent during the same period of the last fiscal. The ECI index carries 40.27 per cent weightage of the Index of Industrial Production (IIP) which is the macro-gauge for India’s factory output. On a sector-specific basis, refinery production, which has the highest weightage of 28.03 per cent, grew by 8.2 per cent in November 2017 as compared with the corresponding month of last year. Electricity generation, which has the second highest weightage of 19.85, picked-up by 1.9 per cent. Steel production, the third most important component with weightage of 17.92, rose by 16.6 per cent during the month under review, whereas coal mining, with a 10.33 weightage, slipped by (-) 0.2 per cent. Extraction of crude oil, which has an 8.98 weightage, increased marginally by 0.2 per cent during the month under consideration. Cement production too, which has a weightage of 5.37, edged higher by 17.3 per cent in November. The sub-index for natural gas output, with a weightage of 6.88, went up by 2.4 per cent. Fertiliser manufacturing, which has the least weightage — only 2.63 — inched-up by 0.3 per cent during the month in question.
“The pickup in the eight core industry numbers is largely positive though the base effect has had a role to play. Healthy performance in steel and cement has contributed to the higher number is noteworthy,” Anis Chakravarty, Lead Economist, Deloitte India, told the IANS.
“However, it is too early to say if this translates to a revival. Steel has particularly been languishing in the past few cycles. It is important to focus on the trend rather than one off data points. The October performance on a sequential basis has also been good. Important to see whether this trend is maintained,” he added.
