India's eight core infrastructure sectors witnessed a growth of 3.7% in December 2025, according to government data released on Tuesday. This marks the second consecutive month of expansion, following a marginal contraction in October 2025. While the growth rate is a deceleration compared to the 5.1% expansion in December 2024, it shows acceleration from the 2.1% growth recorded in November 2025.

The Index of Eight Core Industries (ICI) measures the combined and individual performance of eight key sectors: coal, crude oil, natural gas, refinery products, fertilizers, steel, cement, and electricity. These core industries hold a significant 40.27% weight in the Index of Industrial Production (IIP).

In December 2025, the production of cement, steel, electricity, fertilizer and coal recorded positive growth. Cement production saw a substantial increase of 13.5%, indicating strong demand in the infrastructure and construction sectors. Steel production also grew significantly, with an increase of 6.9%. Electricity generation expanded by 5.3%, while fertilizer output increased by 4.1%. Coal production experienced a more moderate growth of 3.6%.

Conversely, the output of crude oil, natural gas, and refinery products contracted during the same period. Crude oil production decreased by 5.6%, natural gas output shrank by 4.4%, and refinery products experienced a 1% decline. The contraction in crude oil and natural gas production reflects the maturing nature of India's oil fields.

The growth in core sectors is a positive sign for India's industrial momentum. The central government's focus on scaling up capital expenditure to stimulate economic growth and encourage private investment is expected to further boost these sectors. The construction sector is projected to grow by 7% in the current financial year.

The textiles and apparel sector in India has demonstrated resilience with steady growth in December 2025, despite global headwinds and tariffs. Exports rose by 0.40% year-on-year to $3.27 billion, with handicrafts, ready-made garments, and MMF yarn, fabrics, and made-ups registering considerable growth.

Moody's Ratings projects India's economy to grow at 7.3% in fiscal year 2025, driven by stronger growth in household incomes and demand for insurance. Sustained economic expansion, rising risk awareness, increasing digitization, and planned reforms are expected to support premium growth and improve profitability in the insurance sector.