India's eight core infrastructure sectors experienced a growth of 1.7% in June 2025, according to government data released on Monday. This figure marks a rise from the revised growth of 1.2% in May, but is significantly lower than the 5% growth recorded in June of the previous year.
The core sector comprises eight key industries: coal, crude oil, natural gas, refinery products, fertilizers, steel, cement, and electricity. These industries collectively account for 40.27% of the Index of Industrial Production (IIP). The 1.7% growth in June indicates a moderate expansion in these crucial sectors, which have a substantial impact on overall industrial output.
In June, five sectors experienced negative output: coal, crude oil, natural gas, fertilizers, and electricity. Specifically, coal production declined by 6.8%, crude oil output contracted by 1.2%, natural gas output dipped by 2.8%, fertilizer output decreased by 1.2%, and electricity generation fell by 2.8%. The decline in electricity generation could be attributed to excess rains in the latter part of May due to the early onset of the monsoon.
On the other hand, some sectors showed positive growth. Refinery products, steel, and cement output recorded expansions of 3.4%, 9.3%, and 9.2%, respectively. The growth in steel and cement production suggests increased activity in the construction sector.
The growth rate of 1.7% in June is a three-month high, but it also reflects a slowdown compared to the same period last year. During April-June of the current fiscal year, the eight core sectors expanded by 1.3%, which is lower than the 6.2% growth during the corresponding period in the previous fiscal year.
The HSBC India Manufacturing Purchasing Managers' Index (PMI) rose to 58.4 in June from 57.6 in May, signaling expansion in output, new orders and job creation.
The core sector's performance in May was described as lackluster. However, the sequential performance of steel, cement, refinery products, and crude oil improved compared to April, partially offsetting the deterioration in other sectors.
