India’s industrial production registered a four-month high of 3.5% growth in July 2025, according to data released by the National Statistics Office (NSO) on Thursday. The latest figures mark the fourth consecutive month of expansion, underscoring steady demand and the impact of sustained government capital expenditure.
Manufacturing Drives Growth Momentum
The manufacturing sector emerged as the key driver, expanding 5.4% in July, its fastest pace in six months. This compares with 3.7% growth in June and 4.7% in the same month last year.
“The manufacturing industry is expected to maintain its momentum, buoyed by domestic demand and government initiatives,” NSO officials noted, while cautioning that a weak global recovery and sluggish mining activity could temper progress.
Sector-Wise Performance
Mining: Output contracted 7.2% in July, slipping further into negative territory for the fourth straight month, in contrast to a 3.8% growth seen in July 2023.
Electricity: The sector managed a modest 0.6% growth, turning positive after three months, though significantly below last year’s strong 7.9% expansion.
Use-Based Classification: Construction Goods Shine
By category, most sectors showed improvement, except for primary goods, which contracted 1.7%. Key highlights include:
Construction goods: Jumped 11.9%, the highest in 21 months, reflecting strong infrastructure spending.
Capital goods: Grew 5%, recovering from an eight-month low of 3% in June, signaling renewed investment activity.
Intermediate goods: Rose 5.8%, adding to broad-based momentum.
Consumer durables: Surged 7.7%, a seven-month high, driven by demand revival.
Consumer non-durables: Returned to positive territory (0.5%) after five months of contraction.
At the detailed sectoral level, 12 of 23 industries outpaced overall IIP growth — the strongest showing since August 2024. Notably, basic metals, fabricated metal products, electrical equipment, and transport equipment reported double-digit expansion.
Comparative Trend and FY26 Outlook
The IIP data reflects an uneven trend across recent months:
March 2025: 3.9% growth
May 2025: 3.9%
June 2025: 1.5%
July 2025: 3.5%
For the April–July FY26 period, industrial production grew 2.3%, sharply lower than the 5.4% growth in the same period last year.
Analysts say the trajectory highlights resilience in manufacturing but also underlines weak mining output and muted electricity growth. “Investors should monitor policy reforms, infrastructure spending, and export trends to better anticipate opportunities and risks in the industrial economy,” experts advised.
