Passenger cars, commercial vehicles, auto components, spares and accessories have shown significant contribution in growth

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Industrial output in India jumped 5.1 per cent in May compared with 4.9 per cent in April (both based on the new series), mainly on the back of improved manufacturing sector performance, according to Index of Industrial Production (IIP) data released Monday.In May 2026, the Index of Industrial Production recorded a 5.1 per cent year-on-year growth, supported by strong growth of 9.9 per cent in the electricity and gas supply sector and 5.5 per cent growth each in manufacturing, and water supply, sewerage and waste management, Ministry of Statistics and Programme Implementation (MoSPI) said. But, the growth rate in mining and quarrying slipped 1.6 per cent.The Quick Estimate of IIP stands at 122.7 against 116.7 in May 2025 and the IIP for mining and quarrying stands at 112.9, that of manufacturing at 122.6, electricity and gas supply at 129.6, and water supply, sewerage and waste management at 145.1 for May 2026, it said.In positive territoryWithin the manufacturing sector, 16 out of 23 industry groups recorded positive growth while only seven reported a drop. The top three positive contributors for May are “motor vehicles, trailers and semi-trailers” (14.5 per cent growth), “electrical equipment” (20.8 per cent) and “basic metals” (4.6 per cent).“Passenger cars, commercial vehicles, auto components, spares and accessories have shown significant contribution in growth,” said MoSPI commenting on the auto sector. “Computer, electronic and optical products” segment grew at 11.4 per cent while fabricated metal products (except machinery and equipment) expanded by 15.5 per cent, data show.In electrical equipment item group, “switchgear, circuit breakers/switches, control/meter panels and parts”, transformers (small)”, and “UPS and solid-state drives” have shown significant contribution in growth. In basic metals, HR Coils and Sheets of Mild Steel”, HR Plates of Mild Steel, and “Bars and Rods of Alloy and Stainless Steel” are major items in the growth during May.In the manufacturing sector the seven group that reported negative growth are tobacco, apparel, leather products, wood products (except furniture), “printing and reproduction of recorded media”, “coke and refined petroleum products” and chemicals.Growth of eight core industries slipped to 0.5 per cent in May as against 1.8 per cent of April, which is the lowest in seven months and it had fuelled apprehension on the overall IIP growth with some experts even predicted it might be 1-1.5 per cent for May. The combined Index of Eight Core Industries (ICI) measures the combined and individual production performance of eight core industries viz. coal, crude oil, natural gas, refinery products, fertilizers, steel, cement and electricity and they comprise 40.27 per cent of the weight of items in IIP.The ministry earlier revised the base year of IIP from 2011-12 to 2022-23. The revised basket consists of 1,042 products mapped to 463 item groups, including 120 new item groups. This is the 10th revision of the base year for IIP, since the first IIP was prepared with 1937 as base year. According to the MoSPI, the new IIP series provides greater granularity with separate indices for the generation of electricity through renewable and non-renewable, gas supply, fuel minerals, metallic minerals and non-metallic minerals, water supply, sewerage and waste management.Revised methodolofy“The revised methodology, covering nearly 36 per cent of the IIP basket, is expected to provide a more accurate measure of real industrial output and aligns India’s industrial statistics with international best practices,” said Rajeev Juneja, President, PHDCCI. The MoSPI introduced a significant methodological improvement by replacing the Wholesale Price Index (WPI) with the newly introduced Output Producer Price Index (Output PPI) as the deflator for value-based manufacturing items, he added.The use-based classification also indicates broad-based expansion. Highlighting the growth rates as Capital Goods recorded 12.9 per cent in May, followed by Consumer Durables at 7.2 per cent, Infrastructure/Construction Goods at 5.9 per cent, and Intermediate Goods at 5.8 per cent, he said this suggests continued investment activity alongside improving industrial demand.Published on June 29, 2026