Core Sector Growth Slows to 2.3 Per Cent

India’s core sector growth eased to 2.3 per cent in February 2026 on a year-on-year basis, after 4.7 per cent growth in January 2026. The Index of Eight Core Industries (ICI) showed mixed performance, with strong expansion in cement, steel, fertilisers, coal and electricity, but contraction in crude oil, natural gas and refinery products. The core sector is a key indicator of industrial activity and has bearing on the Index of Industrial Production (IIP).

What the Core Sector Measures

The ICI tracks eight major infrastructure and industrial sectors. These are coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity. Together, they account for 40.27 per cent of the weight in the IIP. Because of this high weightage, changes in core sector output influence broader industrial growth trends.

Sector-Wise Performance in February

• Cement production rose by 9.3 per cent, the highest among the eight sectors.
• Steel output increased by 7.2 per cent.
• Fertiliser production grew by 3.4 per cent.
• Coal production increased by 2.3 per cent.
• Electricity generation recorded marginal growth of 0.5 per cent.
• Crude oil production declined by 5.2 per cent.
• Natural gas output fell by 5.0 per cent.
• Petroleum refinery production slipped by 1.0 per cent.

Cumulative Growth in April-February

For the April-February period of the current financial year, core sector growth stood at 2.9 per cent on a provisional basis. Steel and cement remained the strongest performers, with cumulative growth of 9.7 per cent and 9.2 per cent respectively. Fertiliser production rose by 2.0 per cent and electricity generation by 0.9 per cent. In contrast, crude oil output fell by 2.5 per cent and natural gas by 3.5 per cent. Refinery products showed a marginal decline of 0.1 per cent over the same period.

Significance for Industrial Growth

The core sector data is closely watched for signs of demand, investment and infrastructure activity. Strong output in cement and steel usually reflects higher construction and capital spending. Weakness in oil, gas and refinery production can affect energy supply trends and overall industrial momentum.