The steel sector performance supported the core sector output in September which expanded 3% on year despite the contraction in four of the eight components of the Index of Eight Core Industries (ICI).
The growth in September was, however, less than half of 6.5% expansion seen in August, and a three-month low. In September the output of the steel sector that has a weight of 17.92% in the index grew 14.1%, which was higher than 13.6% in August, according to the data released by the department for promotion of industry and internal trade (DPIIT).
The ICI grew 2.4% in September last year.
Other sectors that expanded year-on-year included cement which grew 5.3%, electricity (2.1%) and fertilizers (1.6%). The output of natural gas was down 3.8% on year and the petroleum refining sector was down 3.7%. Crude oil production fell 1.3% and coal production was down 1.2%. In August seven of the eight constituents of the index had reported output growth and the coal sector stood out with a growth of 11.4% .
High growth in steel followed by cement is indicative of heightened activity in infrastructure space . With monsoon over, construction should pick up in the coming months. For fertilizer, the winter sowing period is approaching, which will pull up demand and output. Electricity demand will be on the lower side in coming months, impacting coal output too.
The cumulative growth rate of ICI during April to September, 2025-26 is 2.9 per cent (provisional) as compared to the corresponding period of last year. Last year during the same period the growth in April-September stood at 4.3%.
The eight core Industries comprise 40.27 percent of the weight of items included in the Index of Industrial Production (IIP). Slower growth will impact IIP numbers too but not much as the manufacturing sector dominates the index.