Press Information Bureau

Government of India

Ministry of Finance

27-April-2012 16:55 IST

Declining Growth in Core Sectors

The rate of growth of eight core sectors improved from 2.8% in 2008-09 to 6.6% in 2009-10. It moderated to 5.8% in 2010-11. In 2011-12(Apr-Feb), eight core sectors recorded a growth of 4.4% compared to a growth of 5.8% in the corresponding period of 2010-11. Lower growth rate during 2011-12 has mainly been due to a lower growth in crude petroleum, natural gas and steel sectors.

Government has initiated several steps to augment the production of core sectors by promoting state of the art technologies and by augmenting resources for exploration and mining through private sector participation. To facilitate development of necessary infrastructure, Viability Gap Finding, under the Scheme for support to PPP, has been extended to capital investment in fertilizers sector, oil and gas storage and pipelines facilities. To remove the fuel supply constraints affecting the power generation , the government has advised the Coal India Limited to sign fuel supply agreements with the power plants. In the Budget 2012-13, full exemption from basic duty has been provided to fuels such as natural gas, liquefied natural gas, uranium concentrate etc. imported for power generation. Further, basic customs duty on surveying and prospecting machinery and instruments imported for use in the mining sector has been reduced. Full exemption from basic customs duty has been provided to coal mining projects.

This information was given by the Minister of State for Finance, Shri Namo Narain Meena in written reply to a question in Lok Sabha today.

*****

DSM/SS/SL

Duty exemptions for fuels and mining support production, with VGF extension and fuel supply agreements facilitating investment. The government attributed slower growth in core sectors to weak crude petroleum, natural gas and steel performance and announced measures to boost production: promote private participation in exploration and mining, extend Viability Gap Funding to fertiliser and oil and gas infrastructure under the PPP support scheme, direct Coal India Limited to sign fuel supply agreements with power plants, and grant full exemptions or reductions in basic customs duty for fuels, coal mining projects and mining machinery and instruments.