Eight Core Sector Outputs Turn Negative in February

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Eight Core Sector Outputs Turn Negative in February
Credit: © Reuters.

By Aditya Raghunath

Investing.com -- Government data released on March 31 showed that the output of eight core infrastructure  sectors contracted by 4.6% in February.

“The combined Index of eight core industries stood at 127.8 in February 2021, which declined by 4.6% (provisional) as compared to the index of February 2020,” said the Ministry of Commerce and Industry said in an official release.

  1. Coal: Down 4.4%
  2. Crude oil : Down 3.2%
  3. Natural gas : Down 1%
  4. Refinery products: Down 10.9%
  5. Fertilizers: Down 3.27%
  6. Steel: Down 1.8%
  7. Cement: Down 5.5%
  8. Electricity: Down 0.2%

This contraction of 4.6% is the highest decline in production since August 2020 when it had fallen 6.9%. To give context, in January 2021, the core index had grown 0.9%.

According to data from Commerce and Industry Ministry, the Index of these eight core sectors has seen a growth decline by 8.3% from April 2020-February 2021 compared to a growth of 1.3% in the same period last fiscal. This could mean that the IIP (Index of Industrial Production) contraction in February 2021 could deepen to 2-3% from 1.6% in January 2021, said ICRA (NS: ICRA ) Ltd Principal Economist Aditi Nayar

However, economists have said that the core sector output should expand by 9-11% in March 2021.

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