New Delhi: The growth rate of India’s crucial infrastructure sectors moderated to 4.3{66b0acea7e44836f9b35d2e1dfd840ac263b1a1482ef1ea42798163685e86d37} in May 2023, raising concerns over the country’s economic trajectory amid ongoing uncertainties. This data was reported in the latest government release and indicates a significant slowdown compared to the previous month’s growth rate of 7.9{66b0acea7e44836f9b35d2e1dfd840ac263b1a1482ef1ea42798163685e86d37}.
The core infrastructure sectors play a pivotal role in the overall development and stability of the Indian economy, comprising eight key industries: coal, crude oil, natural gas, refinery products, fertilizers, steel, cement, and electricity.
Additional Facts:
- The slowdown in these sectors comes despite the government’s efforts to stimulate economic growth through various policy measures and reforms.
- Among the core sectors, coal and crude oil reported the most sluggish performance, with growth rates dipping by 1.2{66b0acea7e44836f9b35d2e1dfd840ac263b1a1482ef1ea42798163685e86d37} and 0.8{66b0acea7e44836f9b35d2e1dfd840ac263b1a1482ef1ea42798163685e86d37}, respectively.
- Natural gas and refinery products experienced marginal growth, expanding by only 2.5{66b0acea7e44836f9b35d2e1dfd840ac263b1a1482ef1ea42798163685e86d37} and 3.1{66b0acea7e44836f9b35d2e1dfd840ac263b1a1482ef1ea42798163685e86d37}, respectively.
- In contrast, fertilizers and steel sectors showcased some resilience, registering growth rates of 5.6{66b0acea7e44836f9b35d2e1dfd840ac263b1a1482ef1ea42798163685e86d37} and 6.2{66b0acea7e44836f9b35d2e1dfd840ac263b1a1482ef1ea42798163685e86d37}, respectively.
- The cement sector, a significant indicator of infrastructure activity, witnessed moderate growth at 4.7{66b0acea7e44836f9b35d2e1dfd840ac263b1a1482ef1ea42798163685e86d37} in May.
- The electricity sector, often considered a crucial barometer of economic health, recorded steady growth at 5.9{66b0acea7e44836f9b35d2e1dfd840ac263b1a1482ef1ea42798163685e86d37}, contributing positively to the overall growth rate.
- The sluggishness in key infrastructure sectors raises concerns about the pace of economic recovery and may prompt the government to take further measures to bolster the industries.
Experts believe that various factors contributed to the slowdown, including rising input costs, supply chain disruptions, and the lingering impact of the COVID-19 pandemic. The sectors’ performance is particularly significant as they account for approximately 40{66b0acea7e44836f9b35d2e1dfd840ac263b1a1482ef1ea42798163685e86d37} of India’s overall industrial output.
In response to the latest data, the government has expressed its commitment to undertake necessary policy adjustments and provide additional support to stimulate demand and investment in infrastructure projects. It aims to accelerate economic growth and job creation to counteract the prevailing uncertainties.
While the government’s efforts are laudable, industry stakeholders have emphasized the importance of expediting implementation and execution of infrastructure projects to restore confidence among investors and spur economic activity.
As the Indian economy navigates through challenges and opportunities, policymakers, businesses, and citizens closely monitor the performance of these core sectors, which are integral to achieving sustainable and inclusive growth in the country.