India’s industrial growth eased to 4% in September—slowest in 3 months

New Delhi: India’s industrial production grew 4% annually in September, marking its slowest pace in three months chiefly as mining output contracted, provisional data released by the Ministry of Statistics and Programme Implementation (MoSPI) on Tuesday showed.

Last month’s industrial output, however, was higher than the 3.1% expansion recorded in September last year. In August, India’s industrial production grew 4.1% annually, per MoSPI’s revised data for the month (from 4%).

The latest September reading reflects a fragile and uneven rebound in industrial activity, amid soft domestic demand, global economic uncertainty, and sector-specific challenges.

Industrial performance has remained volatile this fiscal year, slowing during the first quarter (April-June), before picking up pace from July.

India’s core infrastructure sector growth, making up over two-fifths of the country’s industrial output, also eased to a three-month low in September, with output rising 3% year-on-year, provisional data released earlier this month showed.

“Overall, the combination of GST rate rejig, pent-up demand, and the early festive onset appears to have boosted demand in September-October 2025, which is expected to augur well for the growth in manufacturing output in October 2025 as well,” said Aditi Nayar, chief economist at Icra.

“While the GST rationalisation may support demand for regular-use/smaller ticket items post the festive season, the sustenance of the buoyancy in demand for big-ticket items remains to be seen,” Nayar added.

Manufacturing, consumer durables surge

Manufacturing, which accounts for nearly 78% of the Index of Industrial Production (IIP), grew 4.8% year-on-year in September, up from 3.8% in August and 3.9% a year earlier, provisional data showed.

Mining output contracted 0.4% year-on-year in September, compared with a sharp 6.6% expansion in August and a modest 0.2% rise in September 2024.

Electricity generation also slowed, rising 3.1% in September against 4.1% in August and 0.5% in the same month last year.

Among use-based classifications, the production of capital goods, intermediate goods, infrastructure/construction goods, and consumer durables showed a sequential rise, while the production of primary goods slowed and consumer non-durables contracted during September.

Among the lot, consumer durable goods reported the highest rise in September.

Capital goods production rose 4.7% annually in September, compared with a 4.5% growth in the previous month, according to the provisional data.

Intermediate goods output rose 5.3% annually in September, compared to a 5.2% annual growth registered the previous month.

Infrastructure/construction goods output rose 10.5% annually in September, compared with 10.4% in August.

Production of consumer durable goods rose by 10.2% annually in September compared to a 3.5% rise in the previous month.

Meanwhile, primary goods production reported a 1.4% annual growth in September, compared to a 5.4% rise in August.

During September, production of consumer non-durables contracted by 2.9% annually, compared with a 6.4% contraction reported in the previous month.