In April, India’s core sector, comprising coal, steel, cement, fertilizers, electricity, natural gas, refinery products, and crude oil, witnessed a notable 6.2% growth, reflecting positive momentum in key industries. This growth, driven by robust performances in sectors such as steel, electricity, and natural gas, contrasts with the 4.6% growth recorded in April 2023. However, it’s essential to note that March’s growth figures were revised upward to 6%, indicating a stronger trajectory than previously estimated.
Sectoral Performance and Insights
Steel Sector
The steel sector exhibited a healthy 9.4% rise in April 2024, possibly propelled by demand from consumer durables, according to Aditi Nayar, chief economist at ICRA.
Cement Sector
Although witnessing marginal positive growth in April, the cement sector experienced a sequential contraction of 12%, partly attributed to a high base and potential slowdown in government capex during parliamentary elections.
Overall Sectoral Growth
Apart from fertilizers, all sectors demonstrated positive growth, albeit some driven by a low base effect. Fertilizer output saw a decline of 0.8%, primarily due to comparably high growth recorded in April last year.
Long-term Recovery Outlook
While the core sector’s April performance surpassed pre-COVID levels by 19.8% (February 2020), the recovery trajectory varies across industries. Sectors like coal, crude oil, and refinery products are still lagging, with growth rates of just 1.3%, 0.9%, and 7%, respectively, compared to pre-pandemic levels. This indicates the need for sustained efforts for a broad-based and comprehensive recovery, as highlighted by Sunil Sinha, principal economist at India Ratings and Research (Ind-Ra).
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