India's industrial production experienced a slight deceleration in September 2025, with output expanding by 4% year-on-year. This marks the slowest pace of growth in the last three months, according to data released by the Ministry of Statistics and Programme Implementation (MoSPI). The moderation follows a 4.1% increase recorded in August 2025.
The growth of India's eight core sectors also witnessed a sharp slowdown, falling to 3% in September from 6.5% in August. This moderation was attributed to declines in refinery products, natural gas, and crude oil production, which offset strong gains in steel and cement production.
While the manufacturing sector remained a key driver of industrial production, its growth also experienced a slight moderation. In September, the manufacturing sector expanded by 4.8%. Several sectors within manufacturing contributed positively, including basic metals, electrical equipment, and automobiles.
Despite the overall slowdown, some sectors exhibited strong performance. Steel output jumped by 14.1%, and cement production rose by 5.3%, indicating sustained momentum in infrastructure activity. However, energy-related industries faced challenges, with refinery output shrinking by 3.7%, natural gas slipping by 3.8%, and crude oil falling by 1.3%, highlighting persistent weakness in India's hydrocarbons sector.
In August 2025, industrial output also grew by 4%, a decrease from the 4.3% growth in July. A slowdown in manufacturing was the primary reason for the deceleration, although infrastructure goods and mining provided some support. The manufacturing sector's growth slowed to 3.8% in August from 6% in July. However, mining output saw a recovery in August, with a 6% jump. The electricity generation also saw a recovery in July, posting a 4.15% growth in August.
The growth in the consumer durables sector slowed to 3.5% in August 2025 from 7.3% in July. The consumer non-durables sector saw activity contracting 6.3%, the worst performance in eight months.
In August, the infrastructure and construction goods output grew strongly at 10.6%, though at a slightly slower pace than in July, when it had expanded 13.7%.
Experts suggest that public capital expenditure continues to drive investment momentum, while private capital expenditure remains sluggish amid persistent global uncertainties.
