Hopes of industrial recovery bit dust as core industries slipped to the fiscals lowest level of 1.8% in July as petroleum refinery products skidded into negative terrain and steel lost its sheen.
Experts however cautioned against drawing conclusion in haste and said that one month drop or pick up is not an indicator. Industrial production had grown by a surprise 6.8% in July raising hopes of economic recovery.
Core industries grew by 5.1% in July last year. The sector which grew by 6.8% in June had helped the overall recovery as the industrial expansion touched 7.8%
A contraction of 14.4% in petroleum refinery products against 11.8% growth in the year ago period dragged the six key industries in July.
The core sector comprises petroleum refinery, crude oil, coal, electricity, cement and finished steel. They together account for 26.68% in industrial production.
Crude oil at lower rates improved a bit but remained in the negative zone at 0.4%. In the comparable period, it had declined by 3%. However coal expanded by 9.7%, electricity 3.3%, cement 10.6% and finished steel 1.2%. The expansion in steel is lackluster compared to 6% in the same month in 2008.
Mr DK Joshi Principal Economists CRISIL said that "One month drop or pick-up cannot lead to any conclusion adding there was a volatility in the industrial production.”
(Sourced from www.steelguru.com)
Thursday, August 27, 2009
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