Confirming apprehensions of an economic slowdown, the growth rate of eight core infrastructure industries slipped to 2.2 per cent in April this year from 4.2 per cent in the same month of 2011, mainly owing to dismal shows by sectors such as natural gas, crude oil and fertilizers.
Signs of a slowdown setting in were discernible in the earlier months of 2012 also, and for which India Inc. had been ringing the alarm bells as an alert to the authorities to take heed. Official data on the core industries released here on Thursday revealed that overall infrastructure sector growth for March this year also stands revised downwards to 2.2 per cent as compared to a healthier 6.5 per cent expansion witnessed in the same month last year.
Accordingly, the cumulative growth of infrastructure industries for the entire 2011-12 fiscal year also slipped to 4.4 per cent, which is significantly lower than the 6.6 per cent increase seen in 2010-11.
Considering that the eight core sectors — crude oil, petroleum refinery products, coal, electricity, cement and finished steel with a weight of 37.9 per cent in the Index of Industrial Production (IIP) — have shown no improvement in output growth, its negative fall-out on the industrial growth data next month should not come as a surprise.
As per the data, natural gas and crude oil output during April shrank by 11.3 per cent and 1.3 per cent, respectively. Likewise, petroleum refinery products and fertiliser production also witnessed negative growth rates, contracting by 2.8 per cent and 9.3 per cent, respectively during the first month of 2012-13. There was a slowdown in electricity generation also, with the growth in output being at a lower pace of 4.6 per cent during the month as compared to 6.4 per cent in April 2011.
However, the other three sectors — coal steel and cement — fared better as compared to last year. While coal production went up by 3.8 per cent in April this year as compared to an increase of 2.7 per cent witnessed in the same month of 2011, the output of steel and cement grew by a healthy 5.8 per cent and 8.6 per cent during April 2012 as compared to negative growth rates of (-) 2.9 per cent and (-) 0.1 per cent witnessed by the two sectors in the same month a year ago.