February IIP Slumps to 2.9%; Manufacturing, Mining Report Slowdown

The country's industrial production growth (IIP) went down by 2.9% in February from 5% in January, data by the Ministry of Statistics and Programme Implementation (MoSPI) showed. The slowdown can be attributed to weakness in key sectors. In January, the growth touched an eight-month high due to a surge in manufacturing activity.

The growth rate of three sectors reported a drop. Mining grew by 1.6% against 4.4% in January due to weak output. Electricity surged by 3.6% compared to 2.4% in January. Manufacturing, which has the lion's share in the IIP shot up by 2.9% against 5.5% in January.

The Quick Estimates of IIP came at 151.3 against 147.1 in February 2024. During February 2025, the Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors clocked at 141.9, 148.6 and 194.0 respectively.

According to the use base classification, the indices for the month of February 2025 clocked at 152.3 for Primary Goods, 115.5 for Capital Goods, 159.9 for Intermediate Goods and 191.3 for Infrastructure/ Construction Goods. Additionally, the indices for Consumer durables and Consumer non-durables came at 126.5 and 146.7 respectively.

According to use-based classification in February 2025 against February 2024, the corresponding growth rates of IIP came at 2.8% in Primary goods, 8.2 % in Capital goods, 1.5% in Intermediate goods, 6.6% in Infrastructure/ Construction Goods, 3.8% in Consumer durables and (-)2.1% in Consumer non-durables.“Based on use-based classification, the top three positive contributors to the growth of IIP for the month of February 2025 are – Infrastructure/ construction goods, Primary goods, and Capital goods,” the release stated.

Aditi Nayar, Chief Economist, Head – Research & Outreach, ICRA Ltd, said, “As expected, the leap year base pulled down the YoY growth of the IIP to 2.9 per cent in February 2025 from 5.2 per cent in January 2025, largely in line with ICRA’s forecast for the month (+3.0 per cent). The deceleration was broad-based, with all the use-based categories, as well as two of the three sectors barring electricity, witnessing a slower growth in February 2025 vis-à-vis the previous month. Following the base effect induced slowdown in February 2025, the YoY performance of most of the available high frequency indicators improved in March 2025, including electricity generation and the mobility and transport-related indicators, such as GST e-way bill generation, port cargo traffic, diesel consumption, petrol consumption, and vehicle registrations. While steel consumption declined in March 2025, this was dampened by a high base.”