INTEGRATED MAINS AND PRELIMS MENTORSHIP (IMPM) 2025 Daily KEY
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IIP growth dips to three-month low of 4% in Sept
For Preliminary Examination: Current events of national and international Significance
For Mains Examination: GS III - Economy
Context:
Industrial activity dipped marginally to a three-month low of 4% in September. The data also show that the growth in industrial activity during the first half of the financial year was the slowest in at least five years.
Read about:
What is Industrial Production (IIP)?
Goods and Services Tax (GST)
Key takeaways:
- Industrial activity in India witnessed a slight slowdown, slipping to a three-month low of 4% in September 2025, according to the latest data. Figures also indicate that industrial growth during the first half of the 2025–26 financial year has been the weakest in at least five years.
- The Index of Industrial Production (IIP), published by the Ministry of Statistics and Programme Implementation, recorded a 3.2% growth rate in September 2024. After gaining momentum and touching 4.3% in July 2025, growth has once again moderated. Overall, the IIP expanded by 3% during April–September 2025, marking the slowest pace of growth in half a decade.
- Comparatively, industrial growth in the first half of 2021–22 stood at 24%, largely because of the low base created by the pandemic year 2020–21. It subsequently slowed to 7% in 2022–23, 6.3% in 2023–24, and 4.1% in 2024–25.
- The recent dip in output was mainly attributed to a decline in mining, primary goods, and consumer non-durables. The mining sector contracted by 0.45% in September 2025, compared to a strong 6.6% growth in August and 0.2% in September last year.
- Meanwhile, the consumer non-durables segment continued to shrink for the second month in a row, falling 2.9% in September after a 6.4% decline in August, in contrast to a 2.2% expansion a year ago.
- Economist Madan Sabnavis, Chief Economist at the Bank of Baroda, suggested that this downturn could be temporary, as the Goods and Services Tax (GST) rate cuts for the sector were implemented late in the month. He noted that “the real impact of these cuts may become visible in October or November, as retailers work through existing inventories priced before the revision.”
- In contrast, the consumer durables segment showed a strong recovery, posting a 10.2% rise in September 2025, up from 3.5% in August and 6.3% in September 2024. The primary goods sector, however, experienced a slowdown, growing 1.4% in September, compared to 5.4% in August and 1.8% in the same month last year.
- The manufacturing sector offered a brighter n