New Delhi, Sept. 30: Core sector output notched up 3.7 per cent growth in August — the strongest in seven months — against 3.1 per cent in July.
Strong performances by the electricity, cement and coal segments were behind the good show. The output of eight infrastructure industries accounts for almost 38 per cent on the index of industrial production.
The data raise hopes that industrial growth — which has suffered over the past couple of years because of crumbling infrastructure, bureaucratic delays in approvals for projects, a slow pace of policy reforms and high borrowing costs — could be on the road to recovery.
Electricity production in August rose 6.7 per cent from a year earlier, after a 5.2 per cent increase in July.
Coal output rose 5.5 per cent in August, quicker than the 1.2 per cent increase in July, while cement output rose 5.5 per cent compared with a 0.8 per cent increase in July.
Natural gas production continued to fall — a decline of 16.5 per cent in August and 13.1 per cent in July.
Crude oil continued to contract for the fifth consecutive month, though the fall was less steep last month at 1.5 per cent against 2.3 per cent in July.. The decline, however, was lower at 0.6 per cent a year ago.
Steel production growth was lower at 4.3 per cent in August compared with 7 per cent in July, but was higher than 2.9 per cent last August.
Fertiliser output picked up to 1.7 per cent in August from 0.4 per cent in the previous month and higher than the contraction of 2.1 per cent last year.
However, refinery products grew 4.9 per cent in August, down from 31.8 per cent during the same period last year and lower than 5.1 per cent in July.
During the April-August period of 2013-14, the overall growth of core industries has slowed to 2.3 per cent from 6.3 per cent in 2012-13.
India has approached the World Bank to set up a global infrastructure facility (GIF) to help finance about $1 trillion of investments needed for projects in the sector.
“India has asked the World Bank to set up a GIF which will provide loans to infrastructure projects. The World Bank is working on it as they feel the development of the sector is important,” a senior government official said.
The facility will be set up with contributions from India, the World Bank, sovereign wealth funds and pension funds.