India's industrial output slows to 9-month low: Here's why
What's the story
India's industrial output expanded by just 1.2% in May, marking the slowest growth in nine months, according to official data released Monday. The figure is a sharp drop from 2.6% recorded in April, and the weakest pace since August 2024. This year, experts have noted that India's industrial growth has been tepid, largely driven by consumer demand trends.
Annual performance
IIP growth for FY25 stands at 4%
The Index of Industrial Production (IIP) growth for FY25 stands at 4%, a slowdown from the 5.9% pace recorded in FY24. The output of eight core infrastructure sectors, which contribute to nearly 40% of India's industrial output, grew by a mere 0.7% annually in May—the slowest rate in nine months. This data was also released by the Commerce Ministry on June 20.
Sectoral slowdown
Manufacturing activity hits 3-month low in May
India's manufacturing activity also saw a decline, hitting a three-month low in May. The slowdown was attributed to a decline in new orders and output, as per the HSBC India Manufacturing Purchasing Managers's Index compiled by S&P Global earlier in June. These trends further highlight the challenges facing India's industrial sector amid changing consumer demand patterns and economic conditions.