India’s Core Infrastructure Industries Contracts 0.4% in March, Weakest Since Aug 2024

India’s eight core infrastructure industries contracted 0.4% in March 2026, reversing 2.8% growth in February and marking the weakest performance since August 2024. The decline was driven by lower output in coal, crude oil, fertilisers, and electricity, which offset gains in steel and natural gas.

The core sector matters because it accounts for about 40% of the Index of Industrial Production (IIP) and serves as an early signal of broader industrial momentum.

Why Is the Core Sector Data Important for the Economy?

Core sector data is watched closely because it offers an early indication of industrial activity.

The eight industries included in the index are:

• Coal
• Crude oil
• Natural gas
• Refinery products
• Fertilisers
• Steel
• Cement
• Electricity

Together, these sectors influence production costs, energy supply, infrastructure activity, and the broader growth environment.

Which Sectors Dragged Core Industries Growth? 

The biggest drag came from fertilisers, followed by coal and crude oil. 

Here is the growth percentage outlook:

Core industry	March 2026 change	Trend
Coal	-4.0%	Contraction
Crude oil	-5.7%	Contraction
Natural gas	6.4%	Growth
Refinery products	0.07%	Marginal growth
Fertilisers	-24.6%	Sharp contraction
Steel	2.2%	Growth
Cement	4.0%	Growth
Electricity	-0.5%	Contraction

1. Fertilisers See Sharpest Fall

Fertilisers recorded the steepest decline among the eight sectors. Output fell 24.6% in March, compared with 3.4% growth in February. It was the sharpest decline among all eight sectors.

This fall is notable, especially given the reliance on imported raw materials for fertiliser production.

Coal, Crude Oil and Electricity Also Weaken

Other major sectors also reported lower output in March:

• Coal production: down 4%
• Crude oil output: down 5.7%
• Electricity generation: down 0.5%

These readings point to softer momentum in energy-linked sectors at the close of the fiscal year.

2. Steel and Natural Gas Remain Positive

A few segments still posted growth, although the pace was mixed:

• Steel output: up 2.2%
• Natural gas: up 6.4%
• Refinery products: up 0.07%
• Cement: up 4%

Steel expanded at a slower pace than in February, while refinery products were nearly flat. Cement remained positive, but growth also moderated from the previous month.

Read More About: Top 10 Fastest Growing Industries in India 2026

How Does the March Reading Compare With February? 

The contrast with February is sharp.

• February 2026: Core sector grew 2.8%
• March 2026: Core sector contracted 0.4%

This reversal suggests that momentum weakened meaningfully within a month. 

Conclusion 

The March contraction suggests weaker industrial momentum heading into the new fiscal year. Since the core sector has a large weight in the IIP, the latest data may affect expectations for broader industrial production.

Source: https://www.moneycontrol.com/

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