India’s Industrial Output Sees 3% Growth in March for FY 2024-25

India’s industrial output showed a modest growth of 3 percent in March 2025, marking a slight increase from February’s 2.7 percent but a significant decline from 5.5 percent in March 2024. This slowdown can be attributed to underwhelming performances in key sectors such as manufacturing, mining, and power generation. Additionally, the government revised February’s growth estimate downward, reflecting ongoing challenges in the industrial landscape.

Sector Performance Overview

The National Statistics Office (NSO) reported a notable slowdown across several critical sectors. Manufacturing output increased by 3 percent in March 2025, a decrease from 5.9 percent a year earlier. Mining output saw a minimal rise of just 0.4 percent, down from 1.3 percent in March 2024. Power generation growth also eased, dropping from 8.6 percent to 6.3 percent. Aditi Nayar, Chief Economist at Icra, highlighted that while there was a slight improvement in electricity and manufacturing growth, these gains were largely offset by the decline in mining output. She emphasized the need for further observation regarding export trends, particularly concerning potential shifts in trade dynamics with the United States.

Fiscal Year Growth Trends

For the fiscal year 2024-25, the Index of Industrial Production (IIP) expanded by only 4 percent, marking the lowest growth rate in four years. This figure is significantly lower than the 5.9 percent growth recorded in 2023-24 and the 11.4 percent in 2021-22. The previous low was a contraction of 8.4 percent in 2020-21. The mixed results across various sectors indicate a challenging economic environment, with the capital goods sector experiencing a deceleration in growth to 2.4 percent from 7 percent the previous year. Consumer durables saw a growth of 6.6 percent, down from 9.5 percent in March 2024, while consumer non-durables faced a contraction of 4.7 percent, reversing a previous growth of 5.2 percent.

Infrastructure and Construction Growth

The infrastructure and construction goods segment reported a growth of 8.8 percent, slightly improving from 7.4 percent in March 2024. Primary goods experienced a modest increase of 3.1 percent compared to 3 percent last year. However, the intermediate goods sector expanded by only 2.3 percent, a significant drop from the 6.1 percent growth seen in the previous year. These figures reflect a mixed performance across the industrial landscape, highlighting the need for strategic interventions to bolster growth in key sectors.

Changes in Data Release Schedule

In a significant update, the NSO has moved the release date of the IIP data to the 28th of each month, reducing the reporting lag from six weeks to four weeks. This change aims to provide more timely insights into industrial performance, allowing stakeholders to make informed decisions based on the latest data. The adjustment in the release schedule underscores the government’s commitment to enhancing transparency and responsiveness in economic reporting.

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