India’s core sector output rose by 7.9% in September 2026, accelerating from the revised 5.9% in August. While robust infrastructure demand boosted iron ore, coal, and electricity, segments like fertilizers and natural gas faced production hurdles.
India's key industrial sectors picked up pace in September 2026. Data from the Ministry of Commerce and Industry showed that the eight core industries grew by 7.9% compared to the same month last year. This is a significant improvement from August’s revised growth figure of 5.9%.
These eight industries—which include coal, crude oil, natural gas, refinery products, fertilizers, steel, cement, and electricity—make up about 40% of the Index of Industrial Production (IIP). Because they account for a large portion of the index, this monthly data serves as a leading indicator of how the country's broader manufacturing and infrastructure sectors are performing.
Strength Driven by Infrastructure and Energy
The growth in September was largely supported by increased activity in infrastructure and raw material production. Iron ore output led the gains with a rise of 18.4%, reflecting strong demand from domestic steel manufacturers. Electricity generation and coal production also provided a major boost, posting growth rates of 11.4% and 10.7%, respectively. These figures suggest that power demand and industrial raw material consumption remain steady, supported by continued government and private spending on construction projects.
Challenges in Specific Segments
Despite the positive headline number, not every sector is experiencing a boost. Fertilizer production struggled, recording a sharp decline of 11.7%. The energy mix also faced pressure, with natural gas output falling by 4.6% and crude oil production dipping by 1.4%. These declines point to persistent bottlenecks in supply chains and raw material availability within the energy and chemical segments, which have occasionally acted as a drag on the total industrial performance throughout the year.
H1 Performance Comparison
For the first half of the current fiscal year, spanning from April to September, the cumulative growth rate for the core sector stands at 5.1%. This is a notable improvement compared to the 2.5% growth rate recorded during the same six-month period in 2025. This trend suggests that, despite specific pockets of weakness, the overall industrial base is showing more consistent expansion than it did in the previous year.
Investors and economists will now look toward the upcoming release of the Index of Industrial Production (IIP) to see if this strong performance in core industries translates into a broader recovery across the manufacturing and factory output sectors.