Industrial Output Growth Dips To 2.9% In February From 5% In January

The business production, arsenic measured by nan Index of Industrial Production (IIP), fell to 2.9% successful February 2025 from 5% successful January, according to information released by nan Ministry of Statistics and Programme Implementation (MoSPI) connected Friday. 

For February 2025, nan maturation rates of nan mining, manufacturing, and energy sectors were reported astatine 1.6%, 2.9%, and 3.6%, respectively.

The lowest maturation complaint successful caller times was observed successful August of nan erstwhile year, pinch a level maturation complaint of zero percent.

Recent information released successful March indicated a diminution successful maturation for nan halfway assemblage aliases infrastructure industries, dropping to 2.9% successful February from 5.1% successful nan erstwhile month, marking nan lowest maturation complaint successful 5 months.

In nan upcoming fiscal twelvemonth FY25, it is anticipated that nan manufacturing sector, nan cardinal contributor to India's business output, will acquisition a maturation complaint of 4.3 percent. This is simply a important alteration from its erstwhile maturation complaint of 12.3 percent successful nan past fiscal year.

This diminution successful capacity tin beryllium attributed to nan slowdown successful authorities superior expenditure, which only achieved 80 percent of nan yearly target successful nan eleven months of nan fiscal year.

"As expected, nan leap twelvemonth guidelines pulled down nan YoY maturation of nan IIP to 2.9% successful February 2025 from 5.2% successful January 2025, mostly successful statement pinch ICRA’s forecast for nan period (+3.0%). The deceleration was broad-based, pinch each nan use-based categories, arsenic good arsenic 2 of nan 3 sectors barring electricity, witnessing a slower maturation successful February 2025 vis-à-vis nan erstwhile month," said Aditi Nayar, Chief Economist, Head - Research & Outreach, ICRA Ltd.

She added: "Following nan guidelines effect induced slowdown successful February 2025, nan YoY capacity of astir of nan disposable precocious wave indicators improved successful March 2025, including energy procreation and nan mobility and transport-related indicators, specified arsenic GST e-way measure generation, larboard cargo traffic, diesel consumption, petrol consumption, and conveyance registrations. While alloy depletion declined successful March 2025, this was dampened by a precocious base. While nan maturation capacity of mining is expected to deteriorate successful March 2025 comparative to February 2025, this is apt to beryllium offset by an uptick successful energy generation, amid dependable manufacturing growth. ICRA expects nan IIP maturation to people astatine ~3.0% successful March 2025, akin to nan levels seen successful February 2025."

"The IIP maturation came successful astatine 2.9% YoY successful Feb 2025, pinch a noticeable deceleration from 5.2% successful Jan. This is chiefly owed to a worldly slowing successful mining and manufacturing and is partially made worse by nan guidelines effect. The manufacturing sector, which holds nan lion’s stock of nan IIP weight, expanded by 2.9%, its lowest level since past August,  showing subdued agrarian and semi-urban depletion trends. From a use-based perspective, superior equipment posted an awesome 8.2% growth, hinting astatine a gradual revival successful finance activity, while infrastructure and building equipment maintained a beardown 6.6% growth, mostly aided by government-led capex. That said, user non-durables registered a contraction for nan 3rd consecutive period owed to persistent demand-side fragility, particularly successful staples," Sankar Chakraborti, MD & CEO, Acuité Ratings & Research Limited.