Infrastructure output grew at a slower pace of 3 per cent in June as sectors such as coal and steel turned weak while oil and gas production fell-bolstering the case for faster reforms and further rate cuts by the RBI.
The sharp decline in the pace of growth during June follows a six-month high rate of 4.4 per cent in May this year. The growth rate was much higher a year ago at 8.7 per cent in June 2014.
RBI is scheduled to review its policy rates next week on August 4, although it has already cut the rates thrice so far in 2015.
Besides, calls are getting louder for an urgent need to quicken the pace of reforms as a number of key reform proposals including in areas like land, labour and resources are stuck due to a political slugfest.
According to the data released by the Commerce and Industry ministry on Friday, crude oil and natural gas production declined by 0.7 per cent and 5.9 per cent in June this year.
Output of coal, steel, cement and electricity moderated to 6.3 per cent, 4.9 per cent, 2.6 per cent and 0.2 per cent, respectively, during last month.
The output growth of coal, steel, cement and electricity stood at 8.2 per cent, 12 per cent, 13.4 per cent and 15.7 per cent, respectively in June 2014.
In March and April, the eight sectors, which contribute 38 per cent to overall industrial production, had declined by 0.1 per cent and 0.4 per cent respectively. However, in May, the output of the eight sectors expanded by 4.4 per cent.
During April-June period of the current fiscal, the sectors' output expanded by 2.4 per cent as against 6 per cent in the corresponding period last year.
The overall growth of eight core industries in the entire 2014-15 fiscal stood at 3.5 per cent against 4.2 per cent in the previous fiscal.