India's Index of Core Industries (ICI) grew 4.8% year-on-year in August, slightly below July's revised 5.0% growth.
Cement led growth at 12.5%, followed by electricity at 11.6%, iron ore at 5.5%, steel at 3.4% and refinery products at 2.6%.
Coal, natural gas, crude oil and fertilisers all recorded negative growth in August.
Cumulative ICI growth for April-August stood at 4.3%, up from 2.4% in the same period last year.
India's manufacturing PMI stood at 52.8 in August, with business confidence at its highest since May despite softer demand conditions.
A Solid but Slightly Slower Month for Core Industries
Driven by growth in sectors like cement, electricity and iron ore, India's core industrial activity grew by 4.8 per cent (provisional) in August on a year-on-year basis. The growth in the Index of Core Industries (ICI) was, however, slightly less than the growth rate of 5.0 per cent recorded in July (final index), indicating a modest deceleration compared to the previous month.
Sector-Wise Growth Figures
According to a Commerce Ministry statement, cement, electricity, iron ore, steel and refinery products observed growth rates of 12.5 per cent, 11.6 per cent, 5.5 per cent, 3.4 per cent and 2.6 per cent, respectively, last month, with cement and electricity emerging as by far the strongest performers among the eight core sectors tracked by the index.
Iron ore, electricity and cement have been the major drivers of overall growth in industrial production during recent months, suggesting that these three sectors have consistently underpinned the index's performance over an extended period rather than in August alone.
Sectors That Saw a Decline
On the other hand, coal, natural gas, crude oil and fertilisers witnessed negative growth in August 2026, highlighting a clear divergence in performance across the different components of the core industries basket, with energy and fertiliser-related sectors lagging behind the stronger performers.
Moreover, the cumulative growth rate of ICI during April-August was 4.3 per cent (provisional estimate), compared to 2.4 per cent in the corresponding period of the previous year, indicating meaningfully stronger overall industrial momentum this year relative to the same stretch last year.
A Revision to July's Figures
According to the official statement, the final index for the month of July has been revised from 121.2 (provisional estimate) to 120.8. Correspondingly, the annual growth rate for July has been revised down from 5.4 per cent to 5.0 per cent, a modest downward adjustment that slightly narrows the gap between July's and August's growth rates once the revised figures are taken into account.
The Office of Economic Adviser, Department for Promotion of Industry and Internal Trade (DPIIT), released the revised series of the Index of Core Industries (ICI) with Base Year 2022-23 for the first time in July, for data compiled for June this year. The new series has replaced the earlier series of ICI, which used Base Year 2011-12, a methodological update that better reflects the current structure and weightage of India's core industrial sectors.
Manufacturing Sector Performance
Meanwhile, India's manufacturing sector continued to expand in August at 52.8 on the Purchasing Managers' Index (PMI) scale, although firms reported softer demand conditions, which subsequently led to weaker increases in buying levels and stocks. A PMI reading above 50 still indicates expansion, but the softer demand signals suggest that growth momentum within the manufacturing sector may have moderated somewhat compared to earlier months.
Business Sentiment Remains Resilient
Despite the softer performance, business expectations strengthened during the month. Around 16 per cent of survey participants forecast higher output over the coming 12 months, while the remainder expect no change from present levels. Confidence rose to its highest mark since May, but remained subdued by historical standards, according to the latest HSBC India Manufacturing PMI data, indicating that while manufacturers are not currently anticipating a sharp downturn, their outlook remains more cautious than has typically been the case in stronger periods for the sector.
