Infra records growth at 6-mth high of 4.4% in May

With an upsurge in production of coal and refinery products, the output of eight infrastructure sectors expanded by 4.4 per cent in May, the highest growth rate in past six months. The output of eight core sectors had declined in the previous two months of March and April. The core sectors had expanded at a rate of 3.8 per cent in May 2014.

Rating agency ICRA, however, said that the 4.4 per cent growth recorded by the core sector industries came as a respite on the back of the contraction recorded in the previous two months. “The considerable improvement would support a pickup in the pace of industrial expansion in May, although the extent of the same would be tempered by factors such as an adverse base effect, contraction of non-oil merchandise exports and automobile production trends,” it said in a statement. 

The growth in May 2015 was driven by healthy output of coal (7.8 per cent), refinery products (7.9 per cent) and electricity generation (5.5 per cent).

Crude oil production increased by 0.8 per cent while steel and cement grew by 2.6 per cent. Fertiliser output grew by 1.3 per cent. Natural gas, however, recorded a negative growth of 3.1 per cent in May 2015.

In March and April, the eight sectors, which contribute 38 per cent to overall industrial production, had declined by 0.1 per cent and 0.4 per cent respectively. The core sectors’ growth rate in May this year is the highest since November 2014, when these segments had expanded by 6.7 per cent.

During April-May period of the current fiscal, the sectors’ output expanded by 2.1 per cent as against 4.7 per cent in the same period last year. The overall growth of eight core industries in the entire 2014-15 fiscal stood at 3.5 per cent against 4.2 per cent in the previous fiscal.

The growth rate of core sector industries was on a decline since November last year. It was 6.7 per cent in November 2014, which fell to 2.4 per cent in December 2014 and then to 1.8 per cent in January and 1.4 per cent in February.