The August numbers mark the first contraction in core infrastructure output since April 2019, pointing to the continuing weakness in demand conditions.
New Delhi: The growth of eight infrastructure sectors contracted 0.5 per cent in August following broad-based deterioration in output across as many as five sectors, including cement and electricity. But for a turnaround in refinery products — the largest constituent of the core sector — and an uptick in the growth of fertilisers, the contraction in numbers would have been sharper.
The August numbers mark the first contraction in core infrastructure output since April 2019, pointing to the continuing weakness in demand conditions. While analysts expect the festival demand to push industrial growth, the Monetary Policy Committee (MPC) is likely to take note of weak demand conditions in its policy review on October 4 and cut rates.
The eight core sector industries had expanded by 4.7 per cent in August last year.
During the latest reported month, output of coal (-8.6 per cent), crude oil (-5.4 per cent), natural gas (-3.9 per cent), cement (-4.9 per cent) and electricity (-2.9 per cent) contracted while only production of refinery products (2.6 per cent), fertilizers (2.9 per cent) and steel (5 per cent) recorded a growth.
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