New Delhi: India’s Index of Industrial Production (IIP) improved at only 1.5 percent in June 2025, which is the weakest growth in the past 10 months. The fall primarily happened because the mining and power industries performed very weakly. In June last year, the IIP increased at a rate of 4.9 percent, which was significantly higher than this year.
Key sector performance:
– Manufacturing sector: 3.9% growth with marginal improvement (3.5% in June 2024)
– Mining sector: 8.7% fall (10.3% growth in June 2024)
– Electricity generation: 2.6% fall (8.6% growth in June 2024)
Quarterly performance also disappointing
Industrial growth rate fell to 2% during the first quarter (April-June) of 2025-26, as against a growth of 5.4% during the same period of last year. NSO has also lowered the May IIP data from 1.2% to 1.9%, but the number is also short of expectations.
Monsoon impact
Economic analysts are of the opinion that the early onset of monsoon this year has adversely impacted the operations of the energy and mining sector. Particularly those sectors relying on seasonal factors have been hit the hardest.
Future prospects
Even though there has been a marginal pick-up in the manufacturing industry, experts opine that if the mining and power sectors are going to continue performing so weakly in the future as well, then the industrial growth rate could decline even further in the next few months. This has to be noticed by the government and the Reserve Bank so that the economy can be spurred forward.
One can see from these statistics that the Indian industry is suffering from seasonality as well as the impact of the world economic slowdown. Policymakers’ role will become even more critical over the months ahead.