India's Industrial Growth Slows to 13-Month Low in October 2025
India's industrial output growth decelerated sharply to 0.4% in October 2025, marking its weakest pace in over a year. This broad-based slowdown was driven by contractions in power and mining, alongside a significant loss of momentum in manufacturing.
Key Sector Performance: A Tri-Sector Slowdown
The October data reveals weakness across all core sectors. Mining production contracted by 1.8%, a stark reversal from 0.9% growth a year prior. Furthermore, power generation output declined sharply by 6.9%. The manufacturing sector, the largest component, saw growth decelerate to 1.8% from 4.4% in October 2024.
Manufacturing: Mixed Signals Within the Slowdown
Within the manufacturing sector, performance was uneven. Only 9 of 23 industry groups posted positive year-on-year growth. However, some segments showed resilience. Infrastructure and construction goods output expanded by a robust 7.1%. The capital goods sector also grew, albeit at a slower pace of 2.4%.
Consumer Demand Weakness Emerges
A concerning signal from the data is the weakness in consumer-facing segments. Consumer durables production contracted by 0.5%, reversing a 5.5% expansion from the previous year. More significantly, consumer non-durables output declined by 4.4%, indicating a potential pullback in essential goods demand.
Broader Trend: FY26 Growth Deceleration
The October figures contribute to a broader weakening trend for the fiscal year. Industrial production growth for the April-October period of FY26 stands at 2.7%, down from 4% recorded in the same period last year. This suggests the slowdown is not an isolated monthly anomaly.
Context and Comparative Analysis
The 0.4% growth figure represents a significant drop from the 3.7% expansion seen in October 2024. It also follows a revised September 2025 growth figure of 4.6%. This volatility and the recent sharp deceleration highlight the sensitivity of industrial activity to both domestic and global economic headwinds.
Industry Perspective: Interpreting the Slowdown
This data paints a picture of an industrial sector facing multiple pressures. The contraction in power output could reflect both subdued industrial demand and potential supply-side issues. The weakness in consumer durables and non-durables suggests household demand may be softening, possibly due to persistent inflation or tighter financial conditions. The strength in infrastructure/construction goods is a positive outlier, likely supported by continued government capital expenditure.
Potential Implications and Outlook
The broad-based nature of the slowdown may prompt closer economic monitoring. The performance of capital goods, often a leading indicator for future investment, bears watching. If the weakness in consumer goods persists, it could signal deeper demand-side challenges. Policy focus may need to balance support for sustaining investment in infrastructure while addressing factors constraining consumer demand and industrial input costs.
FAQ: India's Industrial Production Slowdown
Q: What does the Index of Industrial Production (IIP) measure?
A: The IIP is an index that measures the short-term changes in the volume of production of a basket of industrial products during a given period, compared to a chosen base period.
Q: Which sector performed the worst in October 2025?
A: The power sector recorded the steepest decline, with output contracting by 6.9% year-on-year.
Q: Is the slowdown concentrated in one area?
A> No, the slowdown is broad-based. Two of the three main sectors (mining and power) contracted, while growth in the third (manufacturing) decelerated significantly. Weakness was also seen across both consumer durable and non-durable goods.
Q: What was the growth rate for the April-October period of FY26?
A> Industrial production grew by 2.7% in the first seven months (April-October) of FY26, which is lower than the 4% growth recorded in the same period of the previous fiscal year.
Q: Were there any positive segments in the data?
A> Yes, the production of infrastructure and construction goods grew strongly by 7.1%, and capital goods output continued to expand, indicating ongoing investment activity in certain parts of the economy.
Check below popular items for more information in Autonexcontrol
