Index of Eight Core Industries (ICI)

The Index of Eight Core Industries (ICI) is a crucial economic indicator that reflects the performance of eight fundamental sectors of the Indian economy. These industries contribute significantly to the overall Index of Industrial Production (IIP), making their growth a key determinant of economic health. The ICI report for January 2025 has been released, showcasing trends in these core sectors and their impact on the industrial and economic landscape.

Understanding the Eight Core Industries

The Eight Core Industries that form the backbone of the ICI are:

Coal
Crude Oil
Natural Gas
Refinery Products (such as petroleum and diesel)
Fertilizers
Steel
Cement
Electricity

These industries together hold a 40.27% weightage in the overall Index of Industrial Production (IIP).

Performance Overview of Eight Core Industries in January 2025

The ICI for January 2025 showed a year-on-year (YoY) growth of 4.2%, reflecting positive momentum in key sectors. This follows a growth of 3.5% in December 2024, indicating a steady improvement in industrial output. The cumulative growth for the period April 2024 to January 2025 stood at 6.1%, compared to 5.3% in the corresponding period of the previous financial year.

Sector-Wise Growth Analysis

1. Coal Industry

The coal sector recorded an impressive growth of 8.5% in January 2025, driven by increased domestic production and higher demand from the power sector.
The cumulative growth for April 2024–January 2025 stood at 9.2%, demonstrating strong expansion.

2. Crude Oil Production

The crude oil sector witnessed a decline of -2.1% in January 2025, primarily due to lower production and maintenance shutdowns at major extraction sites.
The overall performance for April 2024–January 2025 recorded a marginal decline of -1.5%, reflecting supply constraints and global price fluctuations.

3. Natural Gas Production

Natural gas output showed a positive growth of 3.8%, supported by enhanced exploration activities and increased demand from industries and households.
The sector’s cumulative growth for the first ten months of the fiscal year was 4.2%.

4. Petroleum Refinery Products

Refinery production increased by 5.3% in January 2025, fueled by rising petroleum demand and improved refining capacities.
The April 2024–January 2025 cumulative growth reached 6.5%, reflecting strong domestic and export demand.

5. Fertilizer Production

The fertilizer industry posted a moderate growth of 2.7%, supported by higher demand from the agriculture sector.
The overall growth in the fiscal year so far stands at 3.9%, benefiting from government subsidies and policy incentives.

6. Steel Production

The steel sector showed a robust growth of 6.8%, driven by increased infrastructure projects and automobile sector demand.
The cumulative growth for the first ten months was 7.1%, reflecting a strong manufacturing push.

7. Cement Industry

Cement production grew by 5.6%, backed by construction and real estate expansion.
The April 2024–January 2025 period recorded a 5.9% growth, indicating sustained infrastructure development.

8. Electricity Generation

Electricity production increased by 4.1%, supported by higher demand from households, industries, and renewable energy integration.
The sector’s cumulative growth stood at 5.3%, indicating consistent power generation expansion.

Key Takeaways from the ICI January 2025 Report

Overall Growth: The ICI grew 4.2% YoY, indicating industrial recovery.
Strongest Performers: Coal, steel, and refinery products showed significant expansion.
Challenges in Crude Oil: Crude oil production remained negative, impacting overall performance.
Government Support: Policies and infrastructure investments contributed to growth in fertilizers, cement, and electricity.
Steady Cumulative Growth: The cumulative 6.1% growth reflects a stable industrial momentum for FY 2024–25.

Economic Implications of ICI Growth

The growth in core industries is a positive indicator for the Indian economy, boosting overall industrial production and GDP growth.
Strong performance in steel and cement suggests ongoing construction and infrastructure development.
The decline in crude oil production raises concerns about energy security and import dependency.
The positive trajectory in electricity generation highlights the integration of renewable energy sources.

Summary of the News

Aspects	Details
Why in News?	The Index of Eight Core Industries (ICI) report for January 2025 has been released, showing a YoY growth of 4.2%.
What is ICI?	An economic indicator that tracks the performance of eight key industries, contributing 40.27% to the Index of Industrial Production (IIP).
Eight Core Industries	1. Coal 2. Crude Oil 3. Natural Gas 4. Refinery Products 5. Fertilizers 6. Steel 7. Cement 8. Electricity
ICI Growth in January 2025	4.2% YoY growth, improving from 3.5% in December 2024.
Cumulative Growth (Apr 2024–Jan 2025)	6.1% growth compared to 5.3% in the same period of the previous financial year.
Coal Industry	Grew by 8.5% in January 2025, cumulative growth at 9.2%, driven by higher domestic production and demand from the power sector.
Crude Oil Production	Declined by -2.1% in January 2025, cumulative decline of -1.5% due to production cuts and maintenance shutdowns.
Natural Gas Production	Increased by 3.8%, cumulative growth at 4.2%, supported by exploration activities and rising industrial demand.
Refinery Products	Grew by 5.3%, cumulative growth at 6.5%, fueled by high petroleum demand and improved refining capacity.
Fertilizer Production	Grew by 2.7%, cumulative growth at 3.9%, driven by strong agricultural demand and government subsidies.
Steel Industry	Strong growth of 6.8%, cumulative growth at 7.1%, backed by infrastructure projects and automobile sector demand.
Cement Industry	Increased by 5.6%, cumulative growth at 5.9%, reflecting expansion in construction and real estate.
Electricity Generation	Grew by 4.1%, cumulative growth at 5.3%, supported by higher industrial and residential demand.
Key Takeaways	– Strongest growth in coal, steel, and refinery products. – Crude oil production remains a weak link. – Government support boosted fertilizers, cement, and electricity. – Stable industrial momentum with 6.1% cumulative growth.
Economic Impact	– Boost to industrial production and GDP growth. – Steel and cement growth indicate robust infrastructure development. – Declining crude oil output raises energy security concerns. – Electricity sector growth highlights renewable energy integration.