India?s infrastructure industries grew 4.5% in February 2010 against 1.9% in the corresponding month a year ago as a strong performance of crude oil and electricity sectors overshadowed the relatively weak growth in cement and finished steel output.

However, the February growth was lower than the upwardly revised expansion of 9.5% in January 2010. The growth was particularly lower in steel, crude oil, petroleum products and cement sectors.

Analysts blamed volatility, characteristic of core sector industries, for the shift. ?I would not see it as a trend, as the infrastructure is basically very volatile,? Crisis principal economist DK Joshi said. Nomura Holdings economist Sonal Varma said the weak growth in February doesn?t mean that the core sectors are performing poorly. ?It is still growing. The volatility is its characteristic,? she said.

The decline in month-on-month growth rate, Joshi said, is likely to weaken the industrial production. The six core sectors-crude, petroleum refinery products, coal, electricity, cement and finished steel-have a total weight of 26.68% in the industrial output measured on the index of industrial production (IIP).

?We have been registering an IIP growth of more than 16% in the last two months. This cannot be sustained for long and has to come down. What we can sustain is 8-9% growth,? Joshi added.

During February, electricity generation grew by 7.3% against 0.6% a year ago. Crude oil output registered a growth of 4% after contracting 6.2% in February last year. Coal production grew 6.8%, a tad higher than 6% registered in the same month last year. Finished steel and cement expanded by 0.9% and 5.8%, respectively, in the month against 2.4% and 8.3% a year ago. Petroleum refinery products recorded expansion of 0.8% against 0.5% in the corresponding month a year ago.

In January, steel recorded the most growth at 15.3%, while cement expanded at 12.4%. Crude oil clocked a growth of 9.7%, electricity 6.7%, coal 6% and petroleum products 3.8%. In April-February period, the infrastructure sector grew 5.3% against 2.9% a year ago. Crude oil grew 0.2% against decline of 1.7% in the year-ago period, coal expanded by 8% in comparison to 8.2% in the same period of 2008-09. Cement clocked a growth of 10.6%, electricity 6.4% and finished steel 4.5%. But the growth of petroleum refinery product has been negative (-0.4%).

Private cos cannot issue infra bonds: finance secy

Infrastructure bonds in India can be issued by certain banks and financial institutions, but not by private companies, the finance secretary Ashok Chawala said on Friday. ?There is a certain amount of misunderstanding…It does not mean private firms per se will be authorised to raise infrastructure bonds. However, money thus raised will be lent to both private and public entities,? Chawla told reporters after a meeting.