India’s Industrial Output Growth Declines to 5-Month Low of 4.1% in March

The rate at which India’s industrial output grew declined to 4.1% in March 2026, recording the weakest increase in five months, official figures revealed on April 29. The slowdown was mainly driven by softer manufacturing activity and weak electricity generation growth during the month. 

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Data released by the Ministry of Statistics and Programme Implementation showed industrial production had grown 5.1% in February after revision. Economists surveyed by Reuters had estimated industrial output growth at 3.7% for March.

Manufacturing And Power Output Moderate

Manufacturing, which carries the highest weight in the Index of Industrial Production (IIP), recorded growth of 4.3% year-on-year in March, lower than the revised 5.9% growth reported in February.

Electricity generation growth slowed sharply to 0.8% in March from 2.3% in the previous month. Mining activity, however, improved during the month, rising 5.5% compared with 3.1% growth recorded in February.

The March data was also the first full industrial output reading released after the escalation of the Iran conflict following U.S. and Israeli strikes in late February, which triggered concerns over energy supplies and crude oil prices globally.

Consumer Goods Output Weakens

Output of consumer durables, including automobiles and electronics, rose 5.3% year-on-year in March, lower than the revised 7.1% growth recorded a month earlier.

Consumer non-durables output, which includes products such as food items and toiletries, increased 1.1% in March. In February, the segment had recorded a revised contraction of 0.5%.

Capital goods output continued to remain strong, rising 14.6% year-on-year during March compared with revised growth of 12.4% in February. The capital goods segment is considered an indicator of investment activity in the economy.

Annual Industrial Growth At 4.1%

During the financial year that ended on March 2026, growth in the level of industrial production was estimated at 4.1%, which is marginally higher from growth rates of 4% that were observed during the last financial year.

Industrial production numbers are regularly analyzed to determine levels of economic activity within manufacturing, mining, and electricity industries.

Such developments are occurring against the backdrop of higher global oil prices, alongside growing concerns stemming from geopolitical tensions within West Asia.

Though the pace of manufacturing and electricity production slowed down, mining and capital goods production maintained industrial activity in March.