India's industrial output grows 5.1 pc in May, manufacturing, electricity sectors drive expansion
New Delhi, June 29
India's Index of Industrial Production recorded a growth of 5.1 per cent in May 2026 compared to the same month last year, supported by growth in manufacturing and electricity sectors, according to data released by the Ministry of Statistics and Programme Implementation on Monday.
The ministry said manufacturing output grew 5.5 per cent year-on-year in May, while the Electricity and Gas Supply sector recorded a strong growth of 9.9 per cent. However, Mining and Quarrying contracted by 1.6 per cent during the month.
The Quick Estimate of the IIP stood at 122.7 in May 2026, compared with 116.7 in May 2025.
MoSPI also announced a major methodological change in the compilation of the IIP. The ministry has adopted the Output Producer Price Index (Output PPI) as the deflator for the new IIP series with base year 2022-23, replacing the Wholesale Price Index (WPI).
According to the ministry, the change affects 234 out of 463 item groups in the IIP basket, representing 36.02 per cent of the total index weight. The revised series supersedes the earlier WPI-based IIP 2022-23 series released on June 1, 2026.
MoSPI said Output PPI provides a more granular price structure than WPI and will improve the estimation of real output for value-based production items. The ministry added that the move is in line with international best practices and recommendations of the Technical Advisory Committee on the base revision of IIP.
Within the manufacturing sector, 16 out of 23 industry groups recorded positive growth during May 2026.
The top three contributors to manufacturing growth were "Manufacture of motor vehicles, trailers and semi-trailers" with growth of 14.5 per cent, "Manufacture of electrical equipment" with growth of 20.8 per cent and "Manufacture of basic metals" with growth of 4.6 per cent.
According to the ministry, passenger cars, auto components, spares and accessories, and commercial vehicles were among the major contributors to growth in the motor vehicle segment.
Under the use-based classification, capital goods recorded the highest growth of 12.9 per cent, followed by consumer durables at 7.2 per cent, infrastructure and construction goods at 5.9 per cent, intermediate goods at 5.8 per cent, consumer non-durables at 3.6 per cent and primary goods at 2.6 per cent.
The ministry said the top contributors to overall industrial growth in May were intermediate goods, capital goods and primary goods.
MoSPI added that the next IIP data for June 2026 will be released on July 28.
— ANI
Reader Comments
Great to see capital goods growing at 12.9%! That means industries are investing in new machinery and expansion. Manufacturing motor vehicles up 14.5% shows our auto sector is bouncing back strongly. Proud moment for Indian industry! 🇮🇳
The methodological change to Output PPI from WPI is long overdue. International best practices should have been adopted earlier. Glad to see MoSPI modernizing data compilation, though 36% weight changes might create some data discontinuity. Let's see how it pans out.
5.1% is good but we need to remember this is on a base of last year's data. Real growth in employment and wages matters more for common people like us. When will these numbers translate to better jobs and higher incomes for factory workers? 🤔
Electricity sector growing at 9.9% is fantastic! This is a clear sign of increased economic activity and also shows our power infrastructure is keeping pace with demand. Capital goods growth of 12.9% means factories are expanding capacity. Good times ahead for India's manufacturing! 😊
Motor vehicles up 14.5% and electrical equipment up 20.8% - these are impressive numbers. Shows our manufacturing is diversifying beyond just basic metals. The Make in India push is finally showing results. Hope next month's data continues this positive trend.
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.