The Indian economy is getting back on track, and one of the crucial measures for that is the core sector growth. In June 2025, the core sector in India grew 1.7% YoY, which is the quickest in the past three months as per data from the Ministry of Commerce. Let’s dig deeper to find out which sectors grew the most, and which ones were sluggish. 

Sectoral Growth of Core Sectors

As you may know, the there are eight core industries which are considered as the core sectors in India. These includes coal, crude oil, natural gas, fertilisers, cement, steel, refinery products, and electricity. 

Out of these eight, three Infrastructure sectors, refinery products, cement, and steel, witnessed a sequential increase in their production in June, as they increased in May as well. Refinery products output grew by 3.4% YoY in June, and also increased from May’s 1.1% rise. Similarly, the steel output went up by 9.3% YoY in June, up from 7.4% YoY in May. Coming to the Cement output, it increased by 9.2% in June YoY, marginally decreased from 9.7% recorded in May. 

While the overall infrastructure growth in India was positive in June, the other five sectors, apart from the three above, posted negative growth. 

Coal production dropped 6.8% in June while it rose 2.8% in May. Crude oil output dipped by 1.2%, though in May it fell by more than was by 1.8%. Similarly, the natural gas output tanked by 2.8%, however, better than May’s 3.6% drop. 

The fertilizers production in June declined 1.2%, but way better than May’s 5.9% drop, and finally, electricity generation dropped by 2.8%, but in May it fell 4.7%. 

Index of Industrial Production (IIP)

Coming to the IIP, the core sectors’ output makes up 40.27% of this index. During May, this index grew the slowest in the preceding nine months as manufacturing was sluggish. Especially the mining output and electricity generation started declining. For June, the data will be released end of this month. 

Though many analysts have been anticipating a moderate IIP growth in June. For instance, Paras Jasrai, Associate Director of India Ratings and Research, expects IIP growth in June 2025 to be around 1.5% YoY, owing to tepid growth in the industrial sector. 

Another Rating Agency, ICRA, anticipates IIP to be between 1.5% and 2% YoY for June. 

Wrapping up 

So, while the overall core sector output witnessed a jump, but majority of the sectors witnessed a slump owing to the geopolitical challenges, and also domestic economic challenges. However, the growth indicates that the economy is reviving as June growth is way higher than growth recorded in May and April.

Source: Mint

______________________________________________________________________________________

Disclaimer: Investments in the securities market are subject to market risks; read all the related documents carefully before investing.