The low base provided the feel good factor to the core sector, which expanded to a 32-month high of 6.8 per cent in March. However, for the full fiscal 2020-21, the core sector contracted 7 per cent compared with a subdued 0.4 per cent expansion in 2019-20.

“The eight core sector output rose to a 32-month high of 6.8 per cent in March 2021 chiefly on account of a negative base of (-) 8.5 per cent in the corresponding month of the previous year. Therefore, one needs to read the core sector growth number with caution,” said Madan Sabnavis, chief economist, Care Ratings.

In February, output had fallen at the fastest pace in six months, contracting 3.8 per cent. According to data released by the department for promotion of industry and internal trade, coal (-21.9 per cent), crude oil (-3.1 per cent), refinery products (-0.7 per cent) and fertilisers (-5 per cent) saw contraction.

Aditi Nayar, chief economist at Icra, said, “The low base of the lockdown would push up the year-on-year expansion of the core industries. However, we have observed a slackening in sequential momentum in April 2021 in electricity demand, vehicle registrations and generation of GST e-way bills, revealing the impact of the recent surge in Covid infections.”