India's Core Sector Output Declines 0.4% in March, Lowest in 19 Months
Core sector output fell 0.4% in March, lowest in 19 months
The Economic Times
Image: The Economic Times
India's core sector output decreased by 0.4% year-on-year in March, marking the lowest growth in 19 months. This decline was driven by a significant drop in fertiliser production due to the ongoing conflict in West Asia and weaker performance in energy sectors. Analysts predict further impacts in the coming months.
- 01Core sector output fell 0.4% in March, the lowest in 19 months.
- 02Fertiliser production saw a sharp decline of 24.6% due to reduced gas supply amid the West Asia conflict.
- 03Four out of eight core sectors recorded a contraction.
- 04Natural gas output rebounded to a 22-month high of 6.4% in March.
- 05Overall core sector growth for FY26 eased to a five-year low of 2.6%.
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India's core sector output fell by 0.4% year-on-year in March 2023, marking the lowest growth in 19 months. This decline was primarily due to a significant 24.6% drop in fertiliser production, attributed to reduced gas supply stemming from the ongoing conflict in West Asia. Four of the eight core sectors experienced contractions, including crude oil (down 5.7%), coal (down 4%), and electricity (down 0.5%). In contrast, natural gas output rebounded to a 22-month high of 6.4% after a 5% contraction in February. The overall core sector growth for the fiscal year 2026 is projected to be a five-year low of 2.6%, down from 4.5% in FY25. Analysts expect that the impact of rising energy prices and supply constraints will lead to a slowdown in industrial production growth, estimating it to be between 1-2% in March.
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The decline in core sector output could lead to increased prices for essential goods, particularly fertilisers, impacting agricultural productivity and consumer prices.
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