Eight Core Industries of India

Strong growth in eight core output continues in Jan'18, signals the worse is over for industrial production.

Published monthly by the Ministry of Commerce and Industry. Updated till January 2018(Published on February 28, 2018).

Recent Data Trend

Production of eight core industries (which indicates the infrastructure output of the country) of India continued to remain strong growing by 6.7% year on year (YoY) in Jan'18 from a 4% YoY growth in Dec'17.

The acceleration in 8 core output was driven by coal (3% YoY), steel (3.7% YoY) and electricity (5.2% YoY). The coal output made a comeback after contracting by 0.1% YoY in Dec'17. The strong growth in 8 core output is likely to continue supported by improving bank credit growth (9.5% YoY in Jan'18) in the near future.

The strong growth in 8 core output reflects that the worse for the industrial production (8 core output constitutes 43% of the industrial production) is over and the sector has recovered from the brunt of twin shocks in the form of demonetisation in Nov'16 and the Goods and Services Tax (GST) rollout in Jul'17. The industrial production grew at 6% YoY in Oct-Dec quarter (six-quarter high growth), supporting the GDP growth which grew by 7.2% YoY in the same period. So, a strong growth in eight core output in the first month of the last quarter is likely to provide a further push to the GDP growth in the last quarter.

With special support catered to MSMEs (in the form of credit support, capital and interest subsidy) and infrastructure development (Rs.5.97 trillion allocated for infrastructure) in the Union Budget 2018-19, we can expect better infrastructure output in the near future. But, these positive incentives would realise into higher output only when the credit to industries (especially infrastructure) is improved which has remained muted for more than a year due to the persistent twin balance sheet problem.

A brief overview of 8 core industries of India

The data on production of eight core industries of India is published monthly by the Ministry of Commerce and Industry. The current base year for the index of the series is 2011-12=100. The eight core industries included are- Coal, Crude oil, Natural Gas, Petroleum refinery products, Fertilizer, Cement, Steel, and Electricity generation. These 8 industries comprise 40.27% of the weight of the items included in the Index of Industrial Production. For more information please visit the official government website.

Next Release Date: March 31, 2018

Production of eight core industries-Quarterly

8 Core Industries of India(2004-05=100)

Note: The data in the above graph is of the base year 2004-05=100 and has been discontinued since March 2017.