India’s core sector output contracted by 6.5% in March 2020, making it the worst performance going back to 2005. Due to the downfall in the production amid the coronavirus lockdown.
The eight core industries include coal, crude oil, natural gas, refinery products, fertilizers, steel, cement, and electricity, the nationwide lockdown since March 25, to combat the spread of Covid-19 has hampered the production of all of these mentioned items.
Over the years these core sectors had expanded dynamically. Growing by 5.8 per cent in March 2019 and 7.2 per cent in February 2020. While marking the growth of only 0.6 per cent in March 2020.
Production of crude oil, natural gas, refinery products, fertilizer, steel, cement and electricity contracted by 5.5 per cent, 15.2 per cent, 0.5 per cent, 11.9 per cent, 13 per cent, 24.7 per cent and 7.2 per cent respectively in the month under review, official data showed.
The growth rate of coal production declined to 4.1 per cent in March from 9.1 per cent in the same month of 2019.
This downfall in the core sector will also have an impact on the Index of Industrial Production (IIP). As these eight core industries comprise 40.27 per cent of the weight of items in the IIP. For the FY19 the growth in these sectors was 4.4 per cent while for the FY20 it remains flat with 0.6 per cent growth.