India’s core sector output grows 0.5% in April, the lowest in eight months

New Delhi: The output of eight core infrastructure sectors, which account for two-fifths of India’s industrial output, expanded by 0.5% in April, its lowest in the last eight months, from 4.6% in March.

It was recorded at 6.9% in April 2024. The growth in March 2025 was revised from 3.8% to 4.6%.

Only two of the eight core industries—coal and natural gas—reported a sequential rise in production during April, according to the provisional data released by the ministry of commerce and industry on Tuesday.

Core sector output contributes 40.27% to the Index of Industrial Production (IIP).

To be sure, India’s industrial production rebounded in March, recovering from a six-month low in February, according to provisional data released by the ministry of statistics and programme implementation (MoSPI) last month.

Industrial output rose 3% year-on-year in March, slightly above the 2.9% growth in February. The previous low, recorded in August 2024, was zero.

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Coal, gas output rise

Interestingly, of the eight core industries, only coal and natural gas registered a month-on-month increase in production in April.

Coal output rose by 3.5% annually in April, up from 1.6% growth registered in the previous month. Natural gas production rose 0.4%, compared to a contraction of 12.7% in March.

Production in three sectors -- crude oil, refinery products and fertilisers -- contracted in April.

Crude oil production contracted by 2.8% annually in April, compared to a 1.9% contraction in March. Refinery production contracted 4.5% in April, against a 0.2% growth registered in the previous month. Fertiliser production contracted 4.2%, compared to an 8.8% growth in March.

Production of steel, cement and electricity reported growth in April, albeit slower than the previous month. During April, steel production reported a 3% growth, cement 6.7%, and electricity 1%.

Interestingly, India’s manufacturing sector expanded at its fastest pace in 10 months in April, driven by strong demand and a sharp rise in output.

The HSBC India Manufacturing Purchasing Managers’ Index (PMI), compiled by S&P Global, rose to 58.2 in April from 58.1 in March and 56.3 in February. The index was at 57.7 in January and 56.4 in December. A reading above 50 indicates expansion, and below 50 a contraction.

"The core sector growth at 0.5% is quite disappointing, even though the base effect was strong," said Madan Sabnavis, chief economist at the Bank of Baroda.

"The infrastructure-based industries, cement and steel, had registered growth of 6.7% and 3% respectively. Construction activity has helped in keeping output ticking," he said.

"Electricity production increased by 1%, which was affected by the high base of 10.2% last year. May was otherwise an exceptionally hot month where household consumption increased," he added.