Industrial output grows 5.1% in May

• India’s industrial output growth accelerated to 5.1 per cent in May supported by 5.5 per cent growth in manufacturing sector and strong growth of 9.9 per cent in electricity & gas supply sector. 

• The reading stood at 4.9 per cent in April.

Producer Price Index (PPI)

• The latest Index of Industrial Production (IIP) figures for May under the new series are based on the Output Producer Price Index (Output PPI) that provides a more granular price structure than the earlier used Wholesale Price Index (WPI) system.

• This is the second data released after the revision in the base year to 2022-23.

• The new series of the IIP with base year 2022-23 was released on June 1, 2026, using the Wholesale Price Index (WPI) as the deflator. 

• Subsequently, the Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce and Industry, released the Output Producer Price Index (Output PPI) series with base year 2022-23 on June 15, 2026. 

• The transition from WPI to Output PPI assumes significance because a part of industrial production in the IIP is reported in value terms.

• The IIP index has 463 item groups, and the adoption of output PPI, wherein output is collected in value terms, impacts 234 item groups that together account for 36.02 per cent of the total index weight.

Key points of the data:

According to the data, the growth rates of the four sectors are:

i) Mining and quarrying - 1.6 per cent

ii) Manufacturing - 5.5 per cent

iii) Electricity and gas supply - 9.9 per cent

iv) Water supply, sewerage and waste management - 5.5 per cent.

• Within the manufacturing sector, 16 out of 23 industry groups recorded a positive growth in May 2026. 

• The top three positive contributors in May were  manufacture of motor vehicles, trailers and semi-trailers (14.5 per cent), manufacture of electrical equipment (20.8 per cent) and manufacture of basic metals (4.6 per cent). 

• As per the use-based classification, the growth in primary goods was 2.6 per cent, capital goods (12.9 per cent), intermediate goods (5.8 per cent), infrastructure/ construction goods (5.9 per cent), consumer durables (7.2 per cent), and consumer non-durables (3.6 per cent).

(The author is a trainer for Civil Services aspirants.)