India’s January IIP rises 5%, beats estimates on strong manufacturing growth

India’s industrial output expanded by 5% in January, outperforming market expectations of 3.4%, according to official data released on Tuesday.

The growth was higher than December’s 3.5%, signalling resilient manufacturing activity despite global headwinds.

Manufacturing drives growth, electricity lags

Manufacturing output, which constitutes a major portion of the IIP, grew 5.5% in January, compared to 3.4% in the previous month.

Mining activity also accelerated, rising 4.4% against 2.7% in December. However, the electricity sector saw a notable slowdown, growing at 2.4%, down from 6.2% month-on-month (MoM).

India’s Index of industrial production records growth of 5.0% in January 2025

https://t.co/LFBYeNl09J @Rao_InderjitS @_saurabhgarg @PMOIndia @NITIAayogn @PIB_India @PibMospi @mygovindia pic.twitter.com/KPRT1Gaog4

— PIB_MOSPI (@PibMospi) March 12, 2025

Sector-wise performance

Among key industrial categories, primary goods expanded 5.5%, up from 3.8% MoM, while capital goods growth moderated to 7.8% from 10.4% in December. Infrastructure goods posted 7% growth, slightly lower than 7.4% MoM.

Also read: CPI Data February 2025: India’s retail inflation eases to 3.61%

Consumer durables output stood at 7.2%, down from 8.3% in the previous month, indicating moderate demand in discretionary spending. Meanwhile, consumer non-durables contracted 0.2%, though it was a significant improvement from December’s steep 7.5% decline.

The latest IIP figures suggest that India’s industrial activity remains resilient, supported by a strong manufacturing sector and steady capital investment.

However, the decline in electricity output and capital goods growth signals potential risks to sustained momentum.