India’s industrial production recorded a growth of 1.2 per cent in May, dipping lower than 2.7 per cent in the month of April 2025, according to data released by the Ministry of Statistics and Programme Implementation (MoSPI) on Monday. This is the lowest growth rate recorded since 3.1 per cent in September 2024. During the same month last year, India’s industrial activity had grown 5.9 per cent.
The quick estimates of IIP stood at 156.6 in May 2025 against 154.7 a year ago. The Indices of Industrial Production for the mining, manufacturing and electricity sectors for the month of May 2025 came in at 136.3, 154.3 and 216.0 respectively.
The manufacturing output, which carries the largest weight in the index, dropped to 2.6 per cent in May from 3.4 per cent in April. The mining output was at (-)0.1 per cent, and electricity generation dropped to (-)5.8 per cent in May as against 1.1 per cent in April.
As per the use base classification, the indices stood at 57.9 for Primary Goods, 120.1 for Capital Goods, 168.1 for Intermediate Goods and 198.1 for Infrastructure/ Construction Goods for the month of May 2025. Further, the indices for Consumer durables and Consumer non-durables came in at 129.3 and 150.3 respectively.
The corresponding growth rates of IIP as per Use-based classification in May 2025 over May 2024 are (-)1.9 per cent in Primary goods, 14.1 per cent in Capital goods, 3.5 per cent in Intermediate goods, 6.3 per cent in Infrastructure/ Construction Goods, (-) 0.7 per cent in Consumer durables and (-)2.4 per cent in Consumer non-durables. “Based on use-based classification, the top three positive contributors to the growth of IIP for the month of May 2025 are Infrastructure/ construction goods, Capital goods, Intermediate goods,” the release maintained.
Reacting on this, Aditi Nayar, Chief Economist, ICRA Ltd, said, “The early onset of the monsoon doused activity in mining and the demand for electricity, with both these sub-sectors of the IIP reporting a contraction in May 2025, amidst an anemic growth of manufacturing. Moreover, the underlying trends were uneven, with three of the use-based categories displaying a contraction, amidst a continued high 14.1 per cent expansion in capital goods, boosted by a low base.”
The brokerage firm further added that tepid industrial volume growth in the first two months of the quarter doesn’t augur well for industrial GVA growth in Q1FY26.