India's Industrial Production Holds Steady at 4% in September, Driven by Manufacturing

India's industrial output, measured by the Index of Industrial Production (IIP), maintained a stable growth rate of 4% year-on-year in September 2025. This figure is consistent with the revised estimate from August.

The manufacturing sector was the main contributor, registering a robust 4.8% expansion. Key sub-sectors like basic metals (up 12.3%), electrical equipment (up 28.7%), and motor vehicles (up 14.6%) showed significant strength, indicating demand for these goods.

On the other hand, mining sector output declined by 0.4%, a reversal from the previous month's growth. Electricity generation also saw a slowdown, growing by 3.1% compared to 4.1% in August.

The data reveals varied performance across product categories. Infrastructure goods continued their strong growth (+10.5%), and consumer durables saw a substantial jump (+10.2%). Consumer non-durables showed an improved trend with a smaller decline (-2.9%). Capital goods also experienced moderate growth (+4.7%).

Impact This steady IIP growth suggests continued economic activity and resilience, which is generally positive for the stock market. Strong manufacturing output, especially in capital goods and automotive sectors, can signal upcoming business investment and consumer spending. However, the contraction in mining warrants monitoring. Impact Rating: 6/10

Explanation of Terms: Index of Industrial Production (IIP): A measure that tracks the short-term changes in the volume of production in industrial sectors of an economy. It includes mining, manufacturing, and electricity. Manufacturing Sector: The part of the economy that converts raw materials into finished goods. Mining Sector: The part of the economy involved in extracting minerals and other geological materials from the Earth. Electricity Generation: Production of electrical energy. Use-based Classification: IIP data is also categorized by the end-use of the products, such as capital goods (machinery), consumer durables (goods lasting a long time, like appliances), consumer non-durables (goods used up quickly, like food), infrastructure goods, and primary goods. Consumer Durables: Goods that are used repeatedly and last for a long time, such as refrigerators, cars, and furniture. Consumer Non-durables: Goods that are consumed quickly or have a short lifespan, like food, beverages, and toiletries. Capital Goods: Goods used in the production of other goods, such as machinery and equipment. Infrastructure Goods: Goods used in building and maintaining infrastructure, like cement and steel.