Core sector growth jumps to 4-month high of 6.3% in October

The growth rate of eight of core industries rose to four-month high of 6.3% in October on the back of better output in coal, refinery products and electricity, a positive news ahead of the RBI's monetary policy review tomorrow.

The eight core industries -- coal, crude oil, natural gas, refinery products, fertiliser, steel, cement and electricity -- had shrunk by 0.1% in October last year. The growth rate was 1.9% in September this year.

The core sector contributes 38% in the overall industrial production, a parameter that RBI takes into account while framing its monetary policy. The Reserve Bank of India (RBI) is expected to hold interest rate at 8% in its fifth bi-monthly monetary policy review tomorrow.

The industry has been demanding a rate cut to push the economic growth, which has slowed to 5.3% in September quarter from 5.7% in the three months to June 2014. Production in coal, refinery products and electricity registered a growth of 16.2%, 4.2% and 13.2%, respectively in October, as per the data released by the Commerce and Industry Ministry.

Growth in coal and refinery products had declined by 3.5% and 5%, respectively in October 2013 while growth in power generation was only 1.3%. Expansion in crude oil and steel production was 1% and 2.3% respectively in October. The growth in the two sectors was slower than the previous month.

During April-October, the eight sectors grew by 4.3% as against 4.2% in the same period last year.