In the current fiscal, the estimated growth is likely to be over 7.0% in line with the NSO GDP growth estimates of 7.6% for FY24
FinTech BizNews Service
Mumbai, April 6, 2024: Suman Chowdhury, Chief Economist and Head – Research, Acuité Ratings & Research has shared a detailed analysis of Core Sector Output in Feb'24.
“In the post-Covid period, core sector output has seen a strong uptick driven by the consistent rise in public investments in infrastructure and has turned out to be an important element in India’s growth story. From the start of the series (2011-12) to the pre Covid year (2019-20), the average growth in the core sector has been 3.5%. On the other hand, the average sector growth in the Covid and post Covid period (FY20-FY24, Apr-Feb) has been 4.4% despite the economic disruption that took place. In the current fiscal, the estimated growth is likely to be over 7.0% in line with the NSO GDP growth estimates of 7.6% for FY24. Clearly, the core sector along with the manufacturing sector is expected to be one of the key drivers of the economy over the medium term.”
Key Takeaways:
1. Steel production witnessed a growth of 8.5% YoY. While its cumulative output increased by 12.9% in Apr-Feb’24 vs that in last fiscal. Among the eight core sectors, steel has seen the highest growth in the current fiscal driven by buoyant demand from the infrastructure sector.
2. Cement production grew sharply by 10.2% in Feb'24 over 5.6% in Jan'24. The cumulative cement production rose by 9.0% YoY for the Apr-Feb’24 period. Strong cement demand from the infrastructure sector has led to strong volume growth in the current year.
3. Natural Gas production recovered strongly through 11.2% YoY growth in Feb'24. The cumulative index for natural gas surged up by 6.1% YoY in April – February 2023-24. With the focus of the government on cleaner fuels, the demand and consumption of natural gas has seen steady growth, driving increased exploration activities and output.
4. Fertilizer production declined significantly by 9.5% on Feb'24 as compared to the same month of the previous year. This is the second month in the current fiscal when fertiliser output has seen a contraction. However, its cumulative output has risen by 4.1% YoY during April to February, 2023-24 despite the impact of El Nino and the rainfall deficiency during the kharif season.
5. Petroleum Refinery production witnessed a slight growth of 2.6%, in Feb’24 over Feb’23. Its cumulative index increased by 3.9% during April to February, 2023-24 over corresponding period of the previous year.
6. Crude Oil increased by 7.9 per cent in Feb'24 over Feb'23. Nevertheless, domestic crude oil production has continued to be weak and its cumulative output increased marginally by 0.5% during April to February, 2023-24 over corresponding period of the previous year. Total domestic production stood at 2.3 million tonnes (MT) in February.
7. Electricity generation increased by 6.3% in February 2024 over February 2023. Domestic power consumption grew over 8% to 127.8 billion units in February 24, vs February 23. Its cumulative index increased by 6.8% during April to February, 2023-24 over corresponding period of the previous year.
8. Coal production saw the highest annualized growth of 11.6% among the eight segments. The cumulative output rose by 12.2% during Apr-Feb’24 over the corresponding period of the previous year.
