India's core sector output expanded 0.5% in April, its slowest pace in eight months, pulled down by slowdown in production in cement, steel and refinery sectors, official data released Tuesday showed.
The eight core sectors - coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity - account for 40.27% of industrial output. Their output grew 4.6% in March 2025 and 6.9% in April, 2024.
Experts termed the core sector growth disappointing and could moderate the overall industrial output growth.
"The performance of the core sector deteriorated significantly in April 2025," said Aditi Nayar, chief economist, ICRA Ltd.
Nayar said based on the tepid rise in the core sector and the performance of the other available high frequency indicators the IIP (index of industrial production) growth could moderate sharply to about 1% in April.
Bank of Baroda expects IIP growth at 1-1.5%, while Ind-Ra anticipates 1-2%.
The industrial activity rose by 3% year-on-year in March from 2.7% in February, according to official data released last month.
"The core sector growth is quite disappointing even though the base effect was strong," said Madan Sabnavis, chief economist at Bank of Baroda.
In April, five of the eight sectors recorded a growth year-on-year, with cement leading at 6.7%, aided by construction activity and government capex. However, cement production was at a six-month low. Coal recorded a growth of 3.5%, followed by steel (3%), electricity (1%), and natural gas (0.4%).
On the other hand, refinery production growth declined 4.5%, an impact of fall in global crude prices. Output growth of fertilisers and crude oil fell 4.2% and 2.8%, respectively.
"The deceleration was broad-based, led by six of the eight sectors barring coal and natural gas," said Nayar.
Coal and cement kept the infrastructure output away from a contraction, said Paras Jasrai, associate director at India Ratings and Research (Ind-Ra).
"The impact of tariff tantrums led to unprecedented economic uncertainty along with a high base effect that pulled the infrastructure output growth down," he added.
The eight core sectors - coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity - account for 40.27% of industrial output. Their output grew 4.6% in March 2025 and 6.9% in April, 2024.
Experts termed the core sector growth disappointing and could moderate the overall industrial output growth.
"The performance of the core sector deteriorated significantly in April 2025," said Aditi Nayar, chief economist, ICRA Ltd.
Nayar said based on the tepid rise in the core sector and the performance of the other available high frequency indicators the IIP (index of industrial production) growth could moderate sharply to about 1% in April.
Bank of Baroda expects IIP growth at 1-1.5%, while Ind-Ra anticipates 1-2%.
The industrial activity rose by 3% year-on-year in March from 2.7% in February, according to official data released last month.
"The core sector growth is quite disappointing even though the base effect was strong," said Madan Sabnavis, chief economist at Bank of Baroda.
In April, five of the eight sectors recorded a growth year-on-year, with cement leading at 6.7%, aided by construction activity and government capex. However, cement production was at a six-month low. Coal recorded a growth of 3.5%, followed by steel (3%), electricity (1%), and natural gas (0.4%).
On the other hand, refinery production growth declined 4.5%, an impact of fall in global crude prices. Output growth of fertilisers and crude oil fell 4.2% and 2.8%, respectively.
"The deceleration was broad-based, led by six of the eight sectors barring coal and natural gas," said Nayar.
Coal and cement kept the infrastructure output away from a contraction, said Paras Jasrai, associate director at India Ratings and Research (Ind-Ra).
"The impact of tariff tantrums led to unprecedented economic uncertainty along with a high base effect that pulled the infrastructure output growth down," he added.
