Capital Market has conducted a poll amongst economists across leading banks, rating agencies, financial advisories and brokerages for August 2025 IIP growth projections. The results of the poll as indicated by the median of IIP growth forecasts from economists, shows that industrial production growth would improve to 5.5% in August 2025 as against 3.5% growth recorded in July 2025.

Economists expect IIP growth to be in the range of 4.5-5.5% in August 2025. The median of various IIP growth forecast received from economists stood at 5.5%, while the average was slightly lower at 5.2% for August 2025.

Eight core infrastructure sector: August 2025

The output of eight core industries, with a combined weight of 40.3% in the Index of Industrial Production (IIP), increased 6.3% in August 2025 over August 2024. The output of steel increased 14.2%, coal 11.4%, cement 6.1% and fertilizers 4.6%. Further, the output of electricity generation increased 3.1% and petroleum refinery products 3.0%. However, the output of natural gas declined 2.2% and crude oil 1.2% in August 2025. The output of the core sectors increased 2.8% in April-August FY2026 compared with the rise of 4.6% in April-August FY2026.

During August 2025, the eight-core infrastructure sector would contribute overall IIP growth with the positive share of 271 bps, based on 40.3% weight and 6.3% growth in output recorded for the month. The contribution of the eight-core infrastructure sector is showing jump in contribution to the IIP from 164 bps in July 2025.

Index of industrial production: July 2025

India's industrial production (base year 2011-12=100) increased 3.47% in July 2025. The manufacturing sector output moved up 5.44% contributing to the overall rise in industrial production. However, the electricity generation rose at moderate pace of 0.59% and the mining sector output dipped 7.24% in July 2025.

As per the use-based classification, the output of primary goods fell 1.67% in July 2025. However, the output of capital goods increased 5.00% in July 2025. Further, the production of intermediate goods moved up 5.77% and infrastructure/ construction goods gained 11.85% in July 2025. Within the consumer durables, the output of consumer durables increased 7.66% and consumer non-durables moved up 0.48% in July 2025.

In terms of industries, 14 out of 23 industry groups in the manufacturing sector have shown positive growth during the month of July 2025 as compared to the corresponding month of the previous year.

India's industrial production increased 2.35% in April-July FY2026. The manufacturing sector output increased 3.86% in April-July FY2026 contributing to the overall growth in industrial production. However, the electricity generation eased 0.96% and the mining sector output dipped 3.94% in April-July FY2026.

World Industrial production growth: July 2025

As per the data compiled by the Netherlands Bureau for Economic Policy Analysis, the world industrial production increased 3.0% in July 2025 compared to 2.1% rise in July 2024. The industrial output in emerging economies improved 4.2%, while industrial output in advanced economies galloped 1.6% in July 2025 over July 2024.

The industrial production of the Euro area increased 2.0% and US rose 1.3%, while that of Japan declined -0.7% in July 2025 over July 2024.

Among the emerging economies, the industrial output of China increased 5.8%. While that of emerging Asia excluding China moved up 0.4% in July 2025. The industrial production of the Eastern Europe rose 2.3% in July 2025.

Outlook

India’s industrial production growth improved to 3.5% in July 2025 from 1.5% in June 2025 with healthy growth in the manufacturing sector. The electricity generation growth returned to positive zone snapping declined for last two months. However, the mining sector output continued to decline for fourth straight month. Within the manufacturing sector, the output of 14 out of the 23 manufacturing subcategories have shown positive growth. Within used based classification, the consumer goods have shown improvement, while infrastructure and construction goods posted a healthy growth.

The domestic growth remains healthy supported by rural demand, and buoyant government capex continue to boost economic activity. On the supply side, a steady south-west monsoon is supporting kharif sowing, replenishing reservoir levels and boosting agriculture activity. As for the growth outlook, the above normal southwest monsoon, lower inflation, better government capex continues to support domestic economic activity.

The headwinds emanating from prolonged geopolitical tensions, persisting global uncertainties, and volatility in global financial markets pose risks to the growth outlook. The US has imposed an additional 25% tariff on India, taking the overall tariff to 50% leading to high trade-related uncertainties. However, the GST rate cut effective from 22 September and pick up in festive demand is expected to support the overall growth in the economy. The continuous improvement in the consumption and investment activity is necessary for sustaining growth momentum of the industrial production.