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Core Sector Growth Accelerates to 5% in June as Cement, Electricity and Iron Ore Lead Recovery
In June, the output of the country's nine key infrastructure industries rose by 5 percent-the highest level in five months-driven primarily by increased production of cement, electricity, and iron ore. Data released under the new base year of 2022-23 showed a decline in sectors such as crude oil and natural gas, while overall growth for the April-June quarter stood at 3.6 percent.
Production in the nine key infrastructure industries of the country grew 5 percent in June, which was the highest since January. This was largely due to the increased production of cement, electricity, and iron ore. On aggregate, core industry production expanded by 1.1 percent in June and 3.2 percent in May. Data in this release are on the 2022-23 series, where 2011-12 has been the old base year. In addition, iron ore has been added to the list of core industries, thus increasing the number to nine.
According to official data that have been released on Monday, crude oil, natural gas, refinery products, and fertilizers saw a decline in June. However, cement and electricity production went up 9.8 percent, and iron ore, which has become one of the components of the index in the new series, jumped by 43.9 percent. In April-June quarter of the current fiscal year, these key industries grew 3.6 percent compared to 1 percent growth in the previous year.
As part of this revision, the government has implemented several methodological changes. Iron ore has been included as a core industry. The steel index is now calculated using gross production rather than net production to align it with the Index of Industrial Production (IIP). Furthermore, the coal index now includes only raw coal to avoid the double-counting of washed coal and coal middlings.
