India's industrial production grows by 5.1% in May
What's the story
India's industrial production grew by a healthy 5.1% in May, according to the latest data from the Ministry of Statistics and Programme Implementation (MoSPI). The growth was led by a strong performance in manufacturing, which expanded by 5.5%, and electricity and gas supply sectors that witnessed an impressive surge of 9.9%. Despite mining operations contracting during this period, the overall industrial output showed positive growth.
Data update
Revised IIP series
The IIP data for May 2026 shows a significant jump from last year's 3.6%. The base year for the index has been revised from 2011-12 to 2022-23, bringing in more accuracy and relevance. The updated series adds 120 new item groups and separate indices for various sectors, including renewable and non-renewable power generation. It also includes emerging sectors like rare earth minerals, gas supply, water management, and waste treatment.
Economic gage
Importance of IIP
The Index of Industrial Production is a major high-frequency economic indicator for India, measuring output changes across sectors like mining, manufacturing, electricity and gas supply. The revised data series presents a more comprehensive view of industrial activity in the country. It now includes previously underrepresented sectors such as rare earth minerals and gas supply, making it an invaluable tool for policymakers and businesses alike.
Sector performance
Manufacturing sector drives growth
The manufacturing sector, which has the highest weightage of 76% in the IIP basket, grew by 5.5% in May. This is slightly lower than April's growth but shows steady industrial activity. The growth was mainly driven by electrical equipment (20.8%), fabricated metals (15.5%), automobiles (14.5%), and electronics (11.4%). However, mining and quarrying continued to drag down overall output with a contraction of 1.6%.