Infrastructure output growth in India slows to 4.3% in November, cement production surges by 13%
India’s infrastructure sector witnessed a slowdown in growth in November 2024, with output increasing by 4.3 per cent compared to 7.9 per cent in the same month last year. Despite this deceleration, the monthly production growth hit a four-month high, showing signs of recovery. In October 2024, the core sectors expanded by 3.7 per cent, indicating a positive trend in the industry.
### Slowdown in Core Sectors
In November, the output of crude oil and natural gas contracted, while other sectors such as coal, refinery products, fertiliser, steel, and electricity showed moderated growth rates. Coal production saw a rise of 7.5 per cent, refinery products by 2.9 per cent, fertiliser by 2 per cent, steel by 4.8 per cent, and electricity by 3.8 per cent. These figures, however, marked a decline from the higher growth rates recorded in November 2023. The standout performer was the cement sector, which saw a significant increase of 13 per cent during the month, indicating a potential area for future growth and investment.
### Overall Fiscal Year Performance
For the April-November period of the current fiscal year, core sector growth stood at 4.2 per cent, a sharp decline from 8.7 per cent in the same period last year. The eight core sectors collectively contribute 40.27 per cent to the Index of Industrial Production (IIP), highlighting their significant impact on the overall industrial performance in the country.
### Expert Opinion
Aditi Nayar, chief economist at ICRA Ltd, provided insights into the situation, attributing the sequential improvement in November to a sharp rise in cement production driven by a low base effect. She expressed optimism for the future, stating that the IIP is expected to grow by 5-7 per cent in November 2024, partly benefiting from the uptick in core sector growth. This analysis suggests a potential rebound in the infrastructure sector in the coming months, offering hope for the overall industrial landscape in India.
The growth trajectory of India’s infrastructure sector is critical for the country’s economic development and stability. As we navigate through these fluctuations, it is essential to monitor these trends closely to understand the broader implications for various industries and the economy as a whole. Let’s stay informed and engaged as we witness the evolution of India’s infrastructure landscape together.
