Industrial growth slips to three-month low of 3.2% in December

Industrial growth in December

India’s industrial growth eased to 3.2 percent in December from 5 percent in the previous month, data released by the government on February 12 shows.

The dip in industrial production follows a decline in core sector output, which slipped to 4 percent from 4.4 percent in December.

"A combination of an unfavourable base effect and a weak momentum in the manufacturing sector which recorded a growth of 3 percent in December 2024 (at a four-month low) pulled the industrial sector growth to a three-month low. The silver lining was the improved growth in mining and electricity sectors," said Paras Jasrai, senior analyst, India Ratings and Research.

December also marked the fourth consecutive month of expansion for the Index of Eight Core Industries data. The index represents India’s infrastructure output and has a weight of 40 percent in the Index of Industrial Production (IIP).

Among the three major industries, mining growth recorded a five-month high of 2.6 percent. Electricity sector recorded an expansion to 6.2 percent from 4.4 percent earlier.

Manufacturing, on the other hand, declined to 3 percent from 5.5 percent in November.

Manufacturing activity, as indicated by HSBC’s Manufacturing Purchasing Managers' Index, dipped to a 12-month low in December. It is expected to have a better showing in January, as PMI jumped to a seven-month high of 57.7.