Data released by the ministry of commerce and industry on Thursday showed the core sector spanning eight segments — coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity — rose an annual 4% in June, lower than the previous month’s 6.4% and below the 8.4% recorded in June last year.For April-June, the growth rate was 5.7%, a shade lower than the 6% in the same period last year.
The sector accounts for nearly 41% of the index of industrial production and the performance of the core sector has an impact on the outcome of the factory production numbers, which will be released later this month.
Crude oil and refinery products contracted during the month. The crude oil segment declined by 2.6% in June, while refinery products fell by 1.5%.
The steel sector grew by 2.7%, slower than the 6.8% in the previous month, while cement rose 1.9%, higher than the contraction of 0.6% in May.
The coal sector grew a stellar 14.8% in June compared with the 10.2% in the previous month and above the 9.8% in June last year, led by a demand for the commodity due the scorching summer heat. The electricity sector grew by 7.7%, slower than the 13.7% in the previous month but above the 4.2% growth in June last year.
“The core sector expansion slid to a 20-month low of 4% in June 2024, led by a moderation in growth or deepening contraction in five of the eight constituents, barring coal, fertilisers and cement, compared to May 2024,” said Aditi Nayar, chief economist at ratings agency ICRA.
“With the onset of the monsoon, electricity growth reverted to single digits after two months, while remaining healthy at 7.7%. With the dip in the core sector growth, we expect the IIP to post a rise of 3.5-5% in June 2024,” said Nayar.
Greater Noida will soon supply Ganga water to 11 more sectors, including nine in Greater Noida West, by next month. Originally planned for June, the project faced delays. The initiative, costing Rs 848 crore, aims to provide clean water to over 10 lakh residents. The pipelines and underground reservoirs are almost ready, ensuring the supply within months.
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