India’s decline in core sector industry eases, steel, coal show positive Sept growth

India’s decline in core sector industry eases, steel, coal show positive Sept growth

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The contraction in eight Indian core sector industries in September of the current year was the lowest since March this year, with coal, electricity and steel output recording positive growth for the first time since the outbreak of the pandemic, government data released on Friday, October 30, showed.

The data showed that the eight core sector industries shrank 0.8 percent in September, the lowest decline since March, indicating a revival from the impact of the pandemic and the national lockdown.

Coal output recorded a growth of 21.2 percent in September, against a contraction of 20.9 percent during the corresponding month of the previous year. Steel production in September was up 0.9 percent compared to a 1.4 percent contraction in September 2019.

Electricity generation was up 3.7 percent during the month compared to negative growth of 2.6 percent in September 2019.

However, production of natural gas and crude oil continued to show a decline during the month, at 10.6 percent and six percent year on year.

The output contraction of the eight core sectors which account for a little over 40 percent of the Index of Industrial Production (IIP) stood at 14.9 percent for the first half of 2020-21 (April-September), recovering slightly from the 17.8 percent decline registered in the April-August period.

 “While many lead indicators have displayed signals of a strengthening economic recovery in September 2020, we caution that the sustainability of the upturn may not be universal and we await signs of its durability,” financial advisory and rating agency ICRA stated, commenting on the government data.

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