New Delhi: Government’s policy paralysis has started to give its adverse effects on the industry sector. The cumulative growth rate of eight core industries has shrunk to 4.3 percent. It was at 6.6 percent a year before. Ailing production of crude oil, natural gas, fertilisers and coal are said to be main culprits behind the decreasing growth rates. Output growth rate of eight core industries has slipped to 2 percent in March 2012.   

Natural gas sector has been the worst performer in FY 2011-12. The sector’s production has dropped by 8.9 percent in comparison to the last year. Apart from this, performance of fertilizer sector has also been disappointing. Production has grown by meager 0.4 percent. Sectors accounting approximately one percent growth were coal and crude oil. However, steel, cement and power sector have achieved relatively good figures in FY 2011-12.  

The contribution by eight core industries, crude oil, petroleum refinery products, fertilisers, coal, power, cement and finished steel to index of Industrial Production (IIP) is 37.9 percent. Hence, annual performance of eight core industries has its direct impact on annual IIP numbers.

In March, the growth rate of power, steel and fertiliser sector has come down to 2.1 percent, 2.3 percent and 1.5 percent respectively. Whereas in March 2011, the growth rate of these sectors was at 7.6 percent, 12 percent and 3.9 percent respectively. However, the growth rate of eight core industries was at 6.8 percent in February.