Eight core sectors' growth slows down to 2.1% in Feb

New Delhi: The growth of eight core sectors slowed down to 2.1 per cent in February due to fall in output of crude oil and refinery products, official data showed Monday. Eight infrastructure sectors — coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity — had expanded by 5.4 per cent in February 2018.

Production of crude oil and refinery products contracted by 6.1 per cent, and 0.8 per cent, respectively, in February. Growth rate of production of fertiliser, steel, cement and electricity slowed to 2.5 per cent, 4.9 per cent, 8 per cent and 0.7 per cent in February as against 5.2 per cent, 5 per cent, 23 per cent and 4.6 per cent in the same month of 2018, respectively.

However, coal and natural gas output grew by 7.3 per cent, and 3.8 per cent, respectively, in the month under review.

Sluggish infrastructure sector growth will also have impact on the Index of Industrial Production (IIP) as these segments account for about 41 per cent of the total factory output. According to the Commerce and Industry Ministry data, during April-February 2018-19, the eight sectors recorded a flat growth rate of 4.3 per cent over the same period previous fiscal.

Meanwhile, systemwide bad loans will improve by 180 basis points to 8.5 percent in March 2020 from FY19 levels on slower slippages, and the state-run banks will turn profitable for first time in four years, says a report. The banking system will close FY19 with gross non- performing assets of 10.3 percent, ratings agency Crisil said Monday in its half-yearly report on credit movements.

The credit ratio, which is the ratio of upgrades to downgrades, moved up to 1.81 times in the second half of FY19 from 1.68 times in the first half.