IIP growth drops to 3-month low of 4% in Sept, Pg1

Key Highlights:

• IIP growth slowed to 4% in September 2025, a three-month low.
• Industrial activity grew by 3% during the first half of FY26 (April-September), the slowest in five years.
• The mining sector contracted by 0.45% in September 2025.
• The consumer non-durables sector contracted for the second consecutive month, declining by 2.9% in September 2025.

Detailed Insights:

• The Index of Industrial Production (IIP) growth was 3.2% in September of the previous year, 2024.
• The IIP had accelerated to 4.3% by July 2025 before slowing down again to 4% in September 2025.
• The overall index grew 24% in the first half of FY22, due to the low base of the pandemic-affected year.

Half-Yearly (H1) IIP Growth Comparison — FY22 to FY25.png

• Growth slowed to 7%, 6.3%, and 4.1% in the first half of FY23, FY24, and FY25 respectively.
• The slowdown in September 2025 was primarily driven by the mining, primary goods, and consumer non-durables sectors.
• GST rate cuts, implemented late in September, may have temporarily impacted the consumer non-durables sector.

Key Concepts Involved:

• Index of Industrial Production (IIP): An index that shows the growth rates of various industry groups in the economy during a specified period.
• Consumer Non-Durables: Goods that are immediately consumed or have a lifespan of less than three years.
• Goods and Services Tax (GST): An indirect tax levied on the supply of goods and services.