Amidst the surfeit of depressing economic news in recent times, the pickup in infrastructure production in September is a welcome exception. Preliminary statistics issued by the finance ministry suggest that production of six infrastructure industries grew by 5.1 per in September, making it the highest year-on-year growth seen in any month this fiscal year. The previous best was in July when it had clocked 4.6 per cent while the worst had come in August when infrastructure production growth slumped to 2.7 per cent. The first half of 2008-09 closed with a 3.9 per cent growth in infrastructure production, comparing feebly with 6.9 per cent in the same period of 2007-08.
The six infrastructure industries (see table) account for 26.68 per cent of the overall industrial production. The rebounding in September is thus suggestive of an improvement of overall industrial activity in that month. In the first five months of 2008-09, industrial production could barely grow by 4.9 per cent, compared with 10 per cent in the same period last fiscal.
In the first half of 2008-09, infrastructure production was bolstered by coal production that grew appreciably by 7.9 per cent to reach 206 million tonnes. It surpassed by far the 2.8 per cent increase seen in the first six months of 2007-08. All the remaining five industries did worse than in the previous year. Oil production, a growing concern for energy-deficient India, fell by 0.8 per cent to 16.802 million tonnes. Cement production grew by 6.7 per cent in the first half of 2008-09 (previous year: 8.7 per cent) but recent trends point to depressed growth in the subsequent months of October and November. Power generation was only 2.6 per cent higher in the first half as against 7.6 per cent last year. Steel production was up 5.3 per cent in the first six months (7.7 per cent last year) with prospects for subsequent months none too encouraging.
Infrastructure production had grown by 5.6 per cent during the full year 2007-08. While growth in the first half was a respectable 6.9 per cent, it slowed down to 4.4 per cent in the second.