Lockdown knocked wind out from India’s major industries; core sector shrinks up to 25% in one month

Seven out of eight core sectors activities shrank in the month of March, when the country announced a nationwide lockdown. The core industries output contracted by 6.5 per cent in March, which was a free fall from 7.1 per cent in the month of February, according to the Ministry of Commerce & Industry. The highest contraction was observed in the cement industry that contracted by 24.7 per cent in the month. Other industries to show contraction of more than 10 per cent were natural gas (15.2 per cent), steel (13 per cent), and fertilisers (11.9 per cent). The only industry to expand during the period was coal, showing a growth rate of 4 per cent.

The adverse effect of coronavirus showed up at a time when the country’s core industries just came out of a prolonged phase of a slowdown. The output of core industries contracted for four straight months between August and October 2019. In fact, the core industries’ output shrank by 5.5 per cent in October 2019. Altogether, the growth of the core sector in the full fiscal stood at 0.6 per cent, which is at least a 7-year low. In the previous three fiscal years, the core sector grew at more than 4 per cent.

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