India's index of industrial production growth slowed to a seven-month low of 2.9% in February, compared to a 5% increase in January 2025, as per data released by the Ministry of Statistics and Programme Implementation on Friday. The estimate, as per a Bloomberg survey, was of 3.6% growth.
The slowdown in industrial output growth was broad-based, with all the use-based categories, as well as two of the three primary sectors, witnessing a slower growth in February compared to the previous month.
Manufacturing activity expanded on an annual basis by 2.9%, compared to 5.8% in the preceding month.
The output of mining and electricity—the other two main factors determining the IIP—grew by 1.6% and 3.6%, respectively in February. In comparison, mining output rose by 4.4% and electricity generation grew by 2.4% in January.
IIP Sectoral Estimates (YoY)
Industrial output as classified by the end use of goods:
Primary goods production rose by 2.8% in February versus 5.5% in January.
Capital goods output increased by 8.2% versus 10.3% in the preceding month.
Intermediate goods output grew by 5.3%, compared to 1.5%.
Infrastructure and construction goods output rose by 6.6% compared to 7.4% in the preceding month.
Consumer durables output rose by 3.8% versus 7.2% in January.
Consumer non-durables output contracted by 2.1% compared to a contraction of 0.3% in the preceding month.
Following a slowdown in February due to base effects, high-frequency indicators showed improvement in March, according to Aditi Nayar, chief economist and head of research at rating agency ICRA Ltd.
These indicators include electricity generation, mobility and transport-related metrics such as GST e-way bill generation, port cargo traffic, diesel and petrol consumption, and vehicle registrations. Although steel consumption declined in March, this was largely due to a high base.
The agency expects the IIP growth print to remain steady at around 3% in March, similar to the levels seen in February, driven by steady manufacturing growth and an uptick in electricity generation, which is likely to offset a deterioration in mining growth.
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