India’s Core Sector Growth Slows to 2.9% in February

India’s core sector growth slowed to 2.9% in February 2025, marking its weakest expansion in the last five months. This decline was significantly lower compared to 7.1% growth recorded in February 2024. Among the eight core industries, only three saw a monthly rise in production, while cement and fertilizers were the only two sectors that reported higher output compared to the previous year. The slowdown in core sector performance is expected to impact Industrial Production Index (IIP) growth, which had recorded 5% expansion in January 2025.

Key Highlights

Data

• Core sector growth dropped to 2.9% in February 2025, down from 5.1% in January 2025.
• Growth decline was attributed to a high base effect due to the leap year and weaker output in five of the eight industries.

Sector Wise Performance

• Cement (10.5%) and fertilizers (10.2%) were the only sectors that saw an annual increase in production.
• Steel production grew by 5.6%, improving from 4.7% in January 2025.
• Electricity output increased by 2.8%, slightly higher than 2.4% growth in January.
• Coal (1.7%), crude oil (-5.2%), and natural gas (-6%) saw weaker performance.

Other Stats

• Refinery output grew at 0.8%, the slowest in six months.
• The Manufacturing PMI dropped to 56.3 in February, signaling a slowdown in industrial activity compared to 57.7 in January.