Robust Manufacturing Activity Drives India’s Industrial Expansion in August

India’s industrial production grew 8 per cent in August compared with the same month last year, supported by a strong performance from the manufacturing sector, according to data released by the Ministry of Statistics on Monday.

Manufacturing, which accounts for more than three-fourths of the Index of Industrial Production (IIP), expanded 9 per cent during the month. The sector has now recorded growth of 8 per cent or more for three consecutive months, according to the official statement.

The strong manufacturing performance is significant for the broader economy, given the sector’s role in generating employment opportunities for graduates and skilled workers.

Of the 23 industry groups within manufacturing, 18 recorded positive growth in August over the corresponding month of the previous year.

The strongest contributors included manufacturing of electrical equipment, which grew 30.9 per cent, machinery and equipment at 25.3 per cent, and motor vehicles at 25.2 per cent.

Electricity generation and gas supply also recorded strong growth of 12.3 per cent during the month, while water supply, sewerage and waste management expanded 6.3 per cent.

The mining sector, however, contracted 5.6 per cent during August.

The use-based classification of industrial production also showed strong activity in investment-related segments. Capital goods production, which covers machinery and equipment used in factories, increased 16.9 per cent during the month.

Consumer durables production rose 11.1 per cent, reflecting increased output of products such as electronic goods, refrigerators and televisions. Consumer non-durables, including products such as soaps and cosmetics, recorded a more modest growth of 2.1 per cent.

Infrastructure and construction goods production grew 6.4 per cent during August. The official statement attributed the performance to investments in major infrastructure projects, including highways, ports and railways.

Alongside the latest production data, the Ministry of Statistics has revised the IIP series by changing the deflator used for item groups where output is collected in value terms.

The ministry has adopted the Output Producer Price Index (PPI) instead of the Wholesale Price Index (WPI) as the deflator for these groups. The change affects 234 of the 463 item groups in the IIP basket, representing 36.02 per cent of the index weight.

The ministry has consequently revised and released the complete IIP 2022-23 series using Output PPI, superseding the earlier WPI-based series released on June 1, 2026.

MoSPI had released the new All India Index of Industrial Production series with 2022-23 as the base year on June 1, 2026, initially using WPI as the deflator.