India needs to reform both global and domestic policies to boost core sector growth

The core sector, consisting of key industries such as petroleum and refining, electricity generation, steel production, coal mining, crude oil, natural gas, cement, and fertilizers, requires comprehensive policy reforms to enhance its contribution to the overall industrial output.

- Kishore Kumar Biswas

The performance of the broader industrial sector, especially supply-side factors, largely depends on the performance of these core industries. This is because the products from the core industries serve as essential inputs for other industries, as well as sectors like services and agriculture

Key Issues Facing the Core Industries

Petroleum and Refining Industry

The petroleum and refining sector is the largest within the core sector. However, it remains heavily reliant on crude oil imports, with domestic production accounting for only around 15% of the country's needs. To meet the growing demand for oil, India must increase the number of refineries. Yet, the industry faces challenges such as strict environmental regulations, fluctuating demand for lighter products like gasoline and diesel, and volatility in international oil prices due to geopolitical and other factors. These issues make the sector unstable, and India cannot continue relying on seamless petroleum imports unless significant policy reforms are introduced. Moreover, there is an urgent need for more rational use of petroleum resources.

Electricity Sector