The output of eight core industries contracted at a slower rate in June when compared to May, government data showed on Friday. The index of the eight sectors – coal, crude oil, natural gas, refinery products, steel, cement, and electricity – fell by 15% in June.
Fertiliser production was the only sector that registered an increase of 4.2% in June. These eight industries account for 40.27% in the Index of Industrial Production, according to PTI.
Coal production declined 15.5% last month, while crude oil output fell 6% in the same period. The production of natural gas fell 12%, and the output of steel decreased 33.8%. Electricity generation, meanwhile, fell 11% in November. Refinery products also fell 8.9%, while cement declined 6.9%.
The output in the eight core industries had suffered an overall contraction in May, shrinking 23.4%. The decline in output came as the pandemic-induced lockdown kept large parts of the economy shut.
A countrywide lockdown was imposed from March 25 to curb the spread of the coronavirus. This lockdown has badly hit the economy, due to closure of most industries, apart from those producing essential goods. However, from April 20, the Centre allowed certain economic activities to resume in non-hotspot areas of the country.
Subsequently, several states partially opened industries in areas not affected by the coronavirus. On Wednesday, the Centre released guidelines for Unlock 3, the third phase of lifting of restrictions put in place to curb the spread of the coronavirus. The guidelines will come into effect from August 1.
On July 17, rating agency ICRA had sharply revised its forecast for the contraction in the Indian economy to 9.5% in the 2020-’21 financial year from its earlier estimate of 5%. The rating agency cited rising coronavirus cases and the localised lockdown to rein in the pandemic for the downward revision.
The finance ministry, in a report released on July 6, said that India’s gross domestic product is expected to contract 4.5% in the 2020-’21 financial year as predicted by the International Monetary Fund. The ministry too cited the “unprecedented Covid-19 induced supply-demand shocks” for the downward revision of the economic growth.
India on Friday registered a record 55,078 new cases in 24 hours. With this, the country’s tally climbed up to 16,38,870. The toll also rose to 35,747 with 779 new fatalities.