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Thursday, February 25, 2021

Bad news on the economic front, core infra sector down 1.3% in December

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The result for the eight core infra sector has come today amidst the Economic Survey report. The eight core infra sector index declined by 1.3 per cent in December. Sectors such as crude oil, natural gas, refinery products, fertilizer, steel and cement have reported a decline in core infra output due to poor performance.

In December 2019, there was a growth of 3.1 percent in these core sectors. This data has been released by the Ministry of Commerce and Industry. Of the eight sectors, only the coal and electricity sector has gained momentum. Apart from this, negative growth has been recorded in six sectors. Between April – December 2020, the output of the core infra sector declined by 10.10 percent amid the Corona epidemic. In the last half of last year, the output of these sectors had registered a growth of 0.60 per cent.

40% contribution to IIP

Crude oil has fallen by 3.6 percent, natural gas by 7.2 percent, refinery products by 2.8 percent, fertilizer by 2.9 percent, steel by 2.7 percent, cement by 9.7 percent. Explain that the contribution of eight core infra sector in the Industrial Production Index i.e. IIP is 40.27 percent. In such a situation, the decline in core infra output is bad news.

Electricity demand is increasing continuously

The demand for electricity is continuously increasing. Power Minister RK Singh said that power demand reached a record level of 1,88,452 MW so far on Thursday and it is expected to cross 200,000 MW soon. Singh wrote on Twitter on Friday, ‘The demand for electricity reached a new record level of 1,88,452 MW on January 28, 2021 at 9.42 am. The rate at which we are moving forward will soon surpass 2,00,000 MW. In another tweet, he said, ‘The demand in the southern region was highest at 53,214 MW on January 28 at 9.49 minutes’. Earlier, on 20 January, electricity demand reached a record level of 1,87,300 MW. According to the data of the Ministry of Power, the maximum demand for electricity went up to 1,70,970 MW in January last year. The increase in electricity demand suggests a revival in economic activity. This has led to increased demand in the commercial and industrial areas affected by the epidemic and the ‘lockdown’ imposed for its prevention.

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