Manufacturing leads modest recovery as capital goods post double-digit growth; electricity and consumer segments show weakness

India’s industrial output rose by 1.2% in May 2025, according to the latest Quick Estimates of the Index of Industrial Production (IIP), signaling a modest but steady economic pulse amid mixed sectoral performance.

While the growth is slower than April’s 2.7% expansion, the overall index for May rose to 156.6, up from 154.7 in May 2024. The manufacturing sector remained the principal growth driver, expanding 2.6%, even as the mining sector contracted slightly by 0.1%, and the electricity sector shrank sharply by 5.8%.

Of the 23 industry groups within the manufacturing sector classified at the two-digit level, 13 registered positive growth, showcasing resilience.

• Basic metals grew by 6.4%, led by increased production of steel blooms, billets, and alloy products.
• The machinery and equipment segment not elsewhere classified saw the highest growth at 11.8%, boosted by strong output in centrifuges, separators, industrial pumps, and non-automotive combustion engines.
• Non-metallic mineral products, including cement and glassware, registered 6.9% growth, driven by robust construction demand.

In terms of use-based classification, the IIP highlights some bright spots:

• Capital goods surged by 14.1%, reflecting renewed investment activity.
• Primary goods grew to an index level of 157.9.
• Intermediate goods saw 3.5% growth, and infrastructure/construction goods grew 6.3%, indicating ongoing infrastructure momentum.

However, consumer demand showed weakness:

• Consumer durables slipped by 0.7%, with the index at 129.3.
• Consumer non-durables fell further by 2.4%, registering an index of 150.3.

The Central Statistics Office (CSO) also issued the final revision for April 2025 with a 93% weighted response rate, while the May estimates were compiled with an 89.5% response rate. As per the revised calendar, the Quick Estimates will now be released on the 28th of each month or the next working day.

Despite a few setbacks, especially in electricity and consumer spending, the overall IIP data for May indicates that India’s industrial base remains resilient, supported by manufacturing dynamism and strong capital investments.