Industrial output growth hits 5-month high of 5.1%
ECONOMY – INDICATORS
30 JUNE 2026
- Growth in industrial activity quickened to a five-month high of 5.1% in May 2026, buoyed by stronger performances by the manufacturing, electricity, capital goods, and consumer goods sectors, the latest government data show.
- While releasing the data, the Ministry of Statistics and Programme Implementation also said that it has further tweaked the new series of the Index of Industrial Production (IIP), which had first been released on June 1, 2026. The new series has an updated base year of 2022-23 and incorporates new data sources.
- It explained that it has decided to discontinue the use of the Wholesale Price Index (WPI) in the measurement of some value-based outputs in the IIP and has instead adopted the Producer Price Index (PPI) for the purpose.
- The mining and quarrying sector contracted by 1.6%, the fifth consecutive month of contraction.
- But it is not known why this change was implemented belatedly and not when the new series of data was introduced on June 1, 2026.
- It suggests an unusually unsystematic approach by MoSPI.
- The strong growth in the IIP also does not reconcile with the fact that the Index of Eight Core Sectors — a separate government measure of industrial growth — grew at its second-lowest rate in 21 months in May 2026.
- The core sector index is still outdated while the other major indices have been recently updated, but such a discrepancy nevertheless raises questions about what exactly is being measured.
