India’s core infrastructure sector growth eased to 5.4% year-on-year in July 2026, down from an upwardly revised 6% in June, according to provisional data released by the Ministry of Commerce and Industry. Despite the slight month-on-month moderation, the latest figures mark a solid improvement compared to the 3.2% growth recorded in July 2025.
The overall expansion was heavily driven by infrastructure-linked industries. Iron ore emerged as the strongest performer, surging 29.5%, followed by cement at 13.1% and electricity generation at 9%. Coal, steel, and refinery products also posted positive gains during the month. Conversely, three of the core sectors contracted: fertilizer output saw the sharpest decline at 8%, while crude oil and natural gas production fell by 5.3% and 3.7%, respectively.
Because these core industries account for over 40% of the weight of items included in the Index of Industrial Production (IIP), the data serves as a crucial barometer for the broader economy. The July numbers indicate resilient industrial activity supported by public capital expenditure, though import-dependent and energy segments remain vulnerable. Addressing the underperforming sectors, Aditi Nayar, Chief Economist at ICRA, noted that fertilizer output has now contracted for five consecutive months, a trend that reflects the ongoing impact of the West Asia conflict.
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What was the growth rate of India's core sectors in July 2026?
India’s core infrastructure sector growth eased to 5.4% year-on-year in July 2026, slightly down from 6% in June but up from 3.2% in July 2025.
Which sectors drove the core sector growth in July 2026?
The growth was heavily driven by infrastructure-linked industries, with iron ore surging 29.5%, cement growing by 13.1%, and electricity generation increasing by 9%.
Why is the core sector data important?
The core industries account for over 40% of the weight of items included in the Index of Industrial Production (IIP), making it a crucial barometer for assessing the broader health of the Indian economy.
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