India’s Industrial Output Grows 5.1% in May
Manufacturing and electricity sectors drive industrial growth as government adopts Output PPI for revised IIP series
- India’s Index of Industrial Production (IIP) grew 5.1% year-on-year in May 2026.
- Manufacturing expanded 5.5%, while Electricity & Gas Supply rose 9.9%.
- MoSPI replaced WPI with Output PPI as the deflator for the revised IIP series.
- Capital Goods recorded the highest use-based growth at 12.9% during the month.
GG News Bureau
New Delhi, 29th June: India’s Index of Industrial Production (IIP) registered a 5.1 per cent year-on-year growth in May 2026, driven by strong performance in the manufacturing and electricity sectors, according to the Ministry of Statistics and Programme Implementation (MoSPI).
The manufacturing sector, which carries the highest weight in the index, expanded by 5.5 per cent, while Electricity & Gas Supply recorded robust growth of 9.9 per cent. The Water Supply, Sewerage and Waste Management sector grew 5.5 per cent, whereas Mining & Quarrying contracted by 1.6 per cent during the month.
The overall IIP stood at 122.7 in May 2026, compared with 116.7 in the corresponding month last year.
MoSPI also announced a significant methodological change by replacing the Wholesale Price Index (WPI) with the newly introduced Output Producer Price Index (Output PPI) as the deflator for the revised IIP series with base year 2022-23. The change affects 234 of the 463 item groups, accounting for 36.02 per cent of the index weight, and aligns India’s industrial statistics with international best practices.
The Ministry said the revised Output PPI-based IIP series supersedes the WPI-based series released earlier and will improve the estimation of real industrial output, particularly for value-based production items.
Within manufacturing, 16 of the 23 industry groups recorded positive growth during May. The strongest contributors were manufacture of electrical equipment (20.8%), motor vehicles, trailers and semi-trailers (14.5%), and basic metals (4.6%).
On a use-based classification, Capital Goods posted the highest growth of 12.9 per cent, followed by Consumer Durables (7.2%), Infrastructure and Construction Goods (5.9%), Intermediate Goods (5.8%), Consumer Non-durables (3.6%) and Primary Goods (2.6%).
MoSPI said the adoption of Output PPI will also support improved GDP estimation in the future by enabling more accurate volume measurement of industrial production. The next IIP data for June 2026 will be released on July 28, 2026.
