IIP growth accelerates to 23-mth high of 7.3% in June

The mfg sector's output rose 7.8%, up from 2.4% a year ago and 5.2% in May

Informist New Delhi

Growth in India's industrial output rose to a 23-month high in June, boosted by higher electricity production owing to increased seasonal demand and a rise in manufacturing activities. Data released on Tuesday by the statistics ministry showed factory output, as measured by the Index of Industrial Production, jumped to 7.3% in June under the new series.  

At 7.3%, the growth in industrial output was much quicker than estimated. Economists polled by Informist had estimated growth in India's industrial production at 5.9% in June. Industrial production had risen 2.2% in June 2025, as per the new series. The May print was also revised slightly downwards to 5.0% from 5.1% earlier. The Index of Industrial Production series uses the financial year 2022-23 (Apr-Mar) as the base year, compared with FY12 in the old series.

Industrial output surged to a 23-month high amid broad-based acceleration in growth across the four sectors between these months, albeit partly benefitting from a modest base, Aditi Nayar, chief economist at ICRA, said in a note. "While higher volume growth augurs well, margin compression owing to higher input costs is expected to constrain industrial GVA (gross value added) growth in the quarter."  

Growth in production in the electricity and gas supply sectors rose to 10.6% in June from a fall of 2.0% a year ago and 10.3% in May. Electricity production rose 11.4% in June due to higher demand in the summer months.  

The manufacturing sector also pushed Index of Industrial Production growth in June, with the sector's output rising 7.8%, up from 2.4% a year 

ago and 5.2% in May. "Manufacturing output growth, in particular, witnessed a sharp uptick in June 2026, contributing as much as 199 basis points of the 235 bps uptick in the Index of Industrial Production growth relative to May 2026," Nayar said.