NEW DELHI: Growth in the country’s crucial infrastructure sector slowed to a four-month low in September but remained robust, led by a double digit expansion in the coal segment, data showed on Tuesday.
The core sector, spanning coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity, rose 8.1% in September, slower than the 12.5% in the previous month and shade lower than the 8.3% recorded in September last year, data released by the commerce and industry ministry showed.
Crude oil was the only laggard, which contracted 0.4% during the month compared with the 2.1% growth in August. The coal sector posted double digit growth of 16.1% in September compared to a growth of 12.1% in September last year. Steel and electricity sector growth moderated in September to 9.6% and 9.3% respectively, but remained robust.
The eight core industries comprise 41% of the weight of items included in the index of industrial production (IIP) and a strong outcome augurs well for the IIP data, which will be released later this month.
“A pickup in rainfall expectedly flattened the core sector expansion in September 2023 to a four-month low of 8.1% from 12.5% in August 2023, amid the slowdown in growth of seven of the eight constituent sectors barring fertiliser output,” said Aditi Nayar, chief economist at ratings agency Icra. The IIP growth is likely to moderate to high single digits in September 2023, taking a cue from the core sector’s trajectory,” said Nayar. IIP growth rose to a 14-month high in August, led by a robust manufacturing sector. The sector has maintained healthy expansion on the back of strong domestic demand.
Fiscal deficit at 39.3% of FY24 target
The central government’s fiscal deficit touched 39.3% of the full year target in the first half of the current financial year, slightly higher than 37.3% recorded in the year-ago period. In actual terms, the fiscal deficit, or the gap between expenditure and revenue, worked out at over Rs 7 lakh crore at the end of September, as per data released by the Controller General of Accounts.