India’s Infrastructure Output Rises 5% Y/Y in June

A Five-Month Peak for India’s Industrial Engine

India’s infrastructure output surged in June 2024, recording a 5% year-on-year growth rate. This performance marks a five-month high for the sector, signaling a robust recovery for the eight core industries—coal, crude oil, natural gas, refinery products, fertilizers, steel, cement, and electricity—which collectively account for roughly 40% of the Index of Industrial Production (IIP).

Power and Mining Fuel the Expansion

Beyond electricity, the sector saw a sharp output shift driven by iron ore production and an acceleration in cement manufacturing.

Overhauling the Industrial Benchmark

To better mirror the current industrial landscape, the government is preparing a fundamental modernization of the index.

Integrating Iron Ore into the Data Mix

The pending overhaul is set to formalize the inclusion of iron ore as a key component of the index. By recalibrating the weights assigned to each sector, the Ministry intends to produce a more precise macroeconomic indicator.

Stabilization and Future Forecasts

At a Glance: June Sector Performance

• June Growth Rate: 5% year-on-year.
• Performance Peak: Represents a five-month high for the core sector.
• Primary Drivers: Power generation, iron ore, and cement.
• Index Status: Pending revision of base year and weighting components to improve accuracy.