Core Sector Growth @ 5% in March

Bucking the trend of the past two months, the core sector in the country grew 5% in March, a significant rise from the 1% growth registered in February on account of a favourable base effect. While there was robust growth in output of coal and steel sectors, cement, refinery products and fertilisers continued to witness a contraction over the previous year.

Core sector growth for the year ended March hit a five-year high, registering a growth rate of 4.5% over the previous year. In FY 2015-16, the year-on-year growth had stood at 3.9%.

Electricity generation in the country accelerated to 5.9% in March from 1.5% in February. With improved exports, steel output also recorded a strong double digit growth of 11% in the month under review. Cement output, after registering a significant improvement in February, however declined by 6.8% in March.

This contraction in cement output signals that the construction sector is yet to fully recover from the disruption that had set in after the demonetisation of high-value currency notes in November 2016.

Coal production saw a growth of 10% in March from 7.1% in February. Double-digit expansion of Coal India's output is likely to have supported growth in the sector. Fertiliser production declined by 0.8 % in March from the year earlier while crude oil output increased by 0.9% for the same period.

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