New Delhi, July 29: India’s industrial production growth rate stood at an impressive 7.3% year-on-year in June, driven by increased goods exports and robust domestic demand, according to a report released on Wednesday.
The report from Care Ratings highlighted that despite global uncertainties, India’s external sector performed strongly, with a rise in goods exports during the first quarter of the fiscal year 2027 (April-June). Additionally, strong domestic demand has remained a crucial factor.
Most sectors within the industrial domain showed solid performance, although mining and extraction were exceptions. The manufacturing sector’s growth rate surged to 7.8% in June, up from 5.2% the previous month, with 19 out of 23 sub-sectors recording positive growth.
Significant double-digit growth was observed in the electrical equipment sector at 34% and in the motor vehicles, trailers, and semi-trailers sector at 17.5%.
Furthermore, the textile sector grew by 13.7%, the food products sector by 10.8%, and other non-metallic mineral products by 12.9%.
According to the classification based on usage, production of capital goods increased by 14.2%, intermediate goods by 9.3%, consumer durable goods by 7.7%, infrastructure and construction materials by 7.5%, and primary goods by 4.9%.
The report noted a year-on-year increase of 5.8% in the industrial production index (IIP) for the first quarter of fiscal year 2027. Electrical equipment and motor vehicles were the leading sectors, showing robust growth rates of 25.8% and 15%, respectively.
As of July 28, 2026, the rainfall deficit decreased from 40% at the end of June to 15.8%, although it remains below normal levels.
The report cautioned that it is too early to assess the impact of the monsoon on rural demand, but improvements in the sowing of Kharif crops in recent weeks are a positive sign. Overall, India’s industrial activities will need to navigate increasing global uncertainties alongside emerging domestic challenges.
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