Industrial growth jumped to a four-month high of 3.5% in July 2025, driven by a broad-based recovery in the manufacturing, electricity, capital, and consumer goods sectors.

However, the Index of Industrial Production for July 2025, released by the Ministry of Statistics and Programme Implementation on Thursday, grew at a slower pace than the 5% growth seen in July last year.

The manufacturing sector grew at a six-month high of 5.4% in July 2025, compared to 4.7% in July 2024. The electricity sector saw growth returning in July 2025 after two months of contraction. It grew 0.6% in July 2025, compared to 7.9% in July last year.

Mining contraction

The mining sector (-7.2%), however, continued to contract in July 2025, its fourth consecutive month of contraction. 

According to Madan Sabnavis, chief economist at the Bank of Baroda, the mining sector’s relatively poor performance can be attributed to the monsoon as well as to subdued demand.

‘Positive sign for investment’

The capital goods sector grew by 5% in July 2025, on top of an already high base of 11.7% in July 2024.

“Overall, the metals and machinery segments have done well, with basic metals, fabricated metals, and electric machinery registering double digit growth,” Mr. Sabnavis noted. “Non-metallic mineral products too registered an impressive growth of 9.5%. This is a positive sign for investment taking place in the economy.”

The consumer durables sector grew at a seven-month high of 7.7% in July 2025, while the consumer non-durables sector grew at an eight-month high of 0.5%.