CORE
SECTORS - ECONOMY
News: Core sector output rises 5.4% in uneven
recovery
What's
in the news?
●
The output
growth of India’s eight core sectors rebounded to 5.4% in November from a
revised estimate of a 0.9% uptick in October, the slowest in 20 months.
●
This was despite the fact that overall
production levels in November 2022 remained the same as the previous month.
Key
takeaways:
●
The recovery in the year-on-year growth
rate bodes well for the country’s industrial output numbers in November after a
shocking 4% drop in October, as core
sectors constitute about 40% of the Index of Industrial Production (IIP).
●
The IIP
for November will be released on January 12 and economists expect the index to return to growth mode, albeit
in the low single digits.
●
Cement output recovered sharply from a
4.3% contraction in October to jump 28.6% in November, while coal and
electricity production levels accelerated to rise 12.3% and 12.1%,
respectively.
●
Steel output grew at the fastest pace in
six months at 10.8%, but production levels were 2.35% lower than October 2022.
Fertiliser production grew 6.4% from November 2021 levels.
What
are Core Sectors?
●
Core sectors are so-called as are
considered to be the backbone of all
other industries.
●
These are the most important sectors of
the economy and constitute 40.27% of
the weight of items included in the Index of Industrial Production (IIP).
●
The
Index of eight core industries (ICI) is prepared every month by the Office of
the Economic Adviser (OEA), the Department for Promotion of Industry and
Internal Trade (DPIIT), and the Ministry of Commerce & Industry.
Components
of Core Sector:
Core industries include
eight sectors of the Indian economy that are mentioned below.
Weightage
in IIP:
The Eight Core Industries
in decreasing order of their weightage are as follows.
●
Refinery Products> Electricity>
Steel> Coal> Crude Oil> Natural Gas> Cement> Fertilizers.