India’s industrial backbone gained significant momentum in September, with output across its core industries expanding by 7.9%, the strongest increase recorded in the revised data series. The growth rate accelerated from 5.9% in August and exceeded the 3.1% increase reported in September last year. Strong performances in coal, petroleum refinery products, electricity and iron ore production contributed to the improvement, while a favorable comparison with the previous year also supported the figures.
The latest data marks the fourth release under India’s updated core sector index, which now uses 2022–23 as its base year instead of 2011–12. The revised framework also incorporates iron ore, expanding the index to cover nine core industries that play a significant role in the country’s industrial and infrastructure development.
According to Madan Sabnavis, chief economist at Bank of Baroda, the latest figures reflect continued strength in infrastructure-related activities, supported by government expenditure. Spending on road construction has helped sustain demand for cement, while investment in railways has provided support to iron and steel production.
Refinery products registered their strongest expansion under the revised series, increasing 10.3% year over year in September, compared with 5.6% in August. Coal production also recovered sharply, rising 10.7% after contracting 3.8% a month earlier. Iron ore output climbed 18.4%, significantly outpacing the 5.5% growth recorded in August.
Other industries delivered mixed results. Electricity generation grew 11.4%, easing from 13.1% in the preceding month. Steel production improved to 4.9% growth from 3.5%, while cement output expanded 9.8%, slower than August’s 11.7% increase.
However, the broader industrial picture continued to reflect weaknesses in several energy and agricultural input segments. Fertilizer production declined 11.7% year over year, extending its contraction. Natural gas output fell 4.6%, while crude oil production decreased 1.4%.
The eight traditionally tracked core industries, alongside the newly incorporated iron ore category, collectively represent a substantial part of India’s industrial activity. The core sector accounts for 40.27% of the Index of Industrial Production (IIP), making its performance an important indicator of wider manufacturing and economic momentum.
Looking ahead, Bank of Baroda projected September IIP growth at 7.5%–8.5%. Meanwhile, ICRA anticipated a more moderate expansion of 6%–7%, compared with 8% in August. The differing forecasts suggest that, although core industries have strengthened, the pace of broader industrial growth remains subject to variation across sectors.
