New Delhi, 13/02/2025: India’s industrial production growth slowed to a three-month low of 3.2% in December 2024, according to official data released by the National Statistical Office (NSO). The slowdown was largely attributed to subdued performance in the mining and manufacturing sectors, which weighed on overall factory output. Industrial production, measured by the Index of Industrial Production (IIP), had expanded by 4.4% in December 2023, highlighting the deceleration in year-on-year growth.
The government also revised November 2024’s IIP growth downward to 5% from the earlier estimate of 5.2%. In the preceding months, industrial activity showed mixed trends: growth had been stagnant at 3.7% in August, picked up slightly to 3.2% in September, and rose to 3.7% in October 2024. Despite the slowdown in December, the power sector emerged as a strong performer, with output rising 6.2%, compared to just 1.2% a year earlier.
Breaking down the sectoral performance, manufacturing—the largest contributor to the IIP—grew by 3% in December 2024, down from 4.6% during the same month in 2023. Mining output decelerated to 2.6% from 5.2% year-on-year, reflecting weaker activity in resource extraction and raw material industries. Overall, the April-December 2024 period witnessed IIP growth of 4%, slower than the 6.3% recorded in the corresponding period of the previous fiscal year.
Examining the use-based classification provides further insight into sectoral dynamics. Capital goods production, an indicator of investment activity, recorded robust growth of 10.3% in December 2024, up from 3.7% in the same month last year, signaling increased industrial investment and capacity expansion. Consumer durables production also accelerated, rising 8.3% versus 5.2% in December 2023. However, consumer non-durables output contracted sharply by 7.6% in December 2024, in contrast to 3% growth a year earlier, indicating a slowdown in household consumption of essential goods.
Infrastructure and construction goods reported healthy growth at 6.3%, improving from 5.5% in December 2023, reflecting ongoing projects in urban development and construction sectors. Primary goods output, which includes basic raw materials, expanded 3.8%, slightly lower than 4.8% a year ago. The intermediate goods segment, which supplies inputs for other industries, posted a growth of 5.9%, higher than the 3.7% achieved in December 2023, indicating steady demand for industrial inputs.
The data underscores a mixed industrial scenario for India. While capital formation and certain durable goods segments are witnessing strong growth, slower manufacturing and mining output, coupled with a contraction in consumer non-durables, suggest that industrial expansion is uneven. Policymakers and industry stakeholders may need to focus on enhancing productivity, addressing supply-side constraints, and boosting demand in lagging sectors to sustain broader industrial growth in the coming months.
