India's Core Sector Growth Flat in October, Weakest In 14 Months; Coal, Electricity Output Decline

Growth of eight key infrastructure sectors remained flat in October as expansion in output of petroleum refinery products, fertiliser and steel was offset by a contraction in coal and electricity production, according to official data released on Thursday.

The eight core industries of coal, crude oil, natural gas, petroleum refinery products, electricity, fertiliser, and steel had expanded by 3.3% in September and by 3.8% in October 2024.

Coal production declined by 8.5%, electricity generation by 7.6%, and natural gas production by 5%. Crude oil output fell by 1.2% in October on an annual basis, according to the Index of Eight Core Industries released by the Ministry of Commerce and Industry.

On the other hand, petroleum refinery products' output was up by 4.6%, fertiliser production by 7.4%, steel by 6.7%, and cement by 5.3% year-on-year in October.

The zero growth in October 2025 dragged the cumulative growth of eight sectors during April-October to 2.5% compared to 4.3% in the year-ago period.

The output of the eight infrastructre industries remained flat for the first time in last one year.

The growth rate has implications for the country's industrial output growth, as measured by the Index of Industrial Production (IIP), since these core industries account for 40.27 per cent of the index's weight.

Commenting on the data, Aditi Nayar, Chief Economist, ICRA, said excess rainfall impacted mining activity and power demand in October, with the coal output and electricity generation contracting by a sharp 8.5% and 7.6%, respectively, in the month.

Moreover, the growth in steel output decelerated sharply to a six-month low from double-digit levels in the previous month, albeit partly due to an adverse base effect from the early onset of the festive season in 2025, she said.

"Given the deterioration in the performance of the mining and electricity segments, ICRA expects the IIP growth to ease somewhat to about 2.5-3.5% in October 2025 from 4% in September 2025, even as the growth in manufacturing is likely to remain healthy aided by higher demand during the festive season on account of the GST rate rationalisation and the ensuing restocking," Nayar said.