India's Index of Industrial Production grew 6.2% year-on-year in March 2026, rebounding strongly from 4.8% in February and beating the consensus forecast of 5.4%. The acceleration was driven by a 9.8% surge in capital goods production — indicating robust private and government investment activity — and a 7.4% rise in consumer durables output suggesting improving household purchasing power and consumer confidence.
Manufacturing IIP, which constitutes 77.6% of the overall index, grew 6.5% in March after growing just 4.7% in February. Mining output grew 5.2% while electricity generation expanded 8.1%, the latter reflecting higher power demand as pre-summer temperatures rose in March. The full-year FY26 IIP growth averaged 6.1%, the strongest in five years and well above the 4.6% growth recorded in FY25.
The strong IIP data, combined with robust PMI readings and the GDP growth outperformance, paints a consistent picture of strong industrial momentum in India entering FY27. Economists expect IIP to average 6-7% in FY27 supported by continued government capex, private investment revival in sectors like electronics, EVs and specialty chemicals, and the lagged impact of the RBI's monetary easing cycle on credit availability and investment decisions.
