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Economy

Impact of Slowdown? Core Sector Output Contracts by 5.8% in October

This data further raises concerns on a slowing economy.

New Delhi: The output of many important infrastructure sectors contracted in October 2019, according to a new set of government data released on Friday evening.

This data, when combined with the release of the quarterly GDP numbers on Friday evening, raises concerns over a slowing Indian economy.

As many as six of eight core industries saw a contraction in output in October. Coal production fell steeply by 17.6%, crude oil by 5.1%, and natural gas by 5.7%.

Also read: India’s GDP Growth Drops to 4.5% in Q2 FY ’20, Slowest in Over 6 Years

Production of cement (-7.7%), steel (-1.6%), and electricity (-12.4%) also declined during the month. The only sector that posted growth in October was fertilisers where production increased by 11.8% year-on-year.

Growth in output of refinery products slowed down to 0.4% in October as against 1.3% in the same period last year.

The eight core sectors had expanded by 4.8% in October 2018.

During the April-October period, the growth of core industries fell to 0.2% against 5.4% in the year-ago period. Output of eight core infrastructure industries had contracted by 5.1% in September, which was the lowest recorded in the last decade.

Fiscal deficit target

Adding to the double-whammy of concerning economic data, India’s fiscal deficit for the first seven months of this fiscal year stood at Rs 7.2 lakh crore or 102.4% of the budgeted target for FY’20. 

Net tax receipts in the April-October period was Rs 6.83 trillion, while total expenditure was Rs 16.55 trillion, the data showed.

(With inputs from PTI)