India’s industrial sector showed strong performance in December 2025, as industrial output growth reached a level not seen in more than two years. According to government data released on Wednesday, the Index of Industrial Production (IIP) rose by 7.8 per cent compared to the same period last year. This marked a significant improvement and reflected a broad-based acceleration across key sectors of the economy.

The December figure came after an upwardly revised growth of 7.2 per cent in November, indicating a steady rise in industrial activity toward the end of the year. The strong performance was mainly driven by manufacturing, mining, and electricity sectors, which together contributed to the overall increase in industrial production.

Manufacturing output recorded an expansion of 8.1 per cent in December, making it the biggest contributor to the growth in industrial output. Mining activity grew by 6.8 per cent, while electricity generation increased by 6.3 per cent during the same period. These numbers reflected resilient demand across infrastructure, capital goods, and consumer segments.

Economists surveyed by Reuters had expected industrial output to grow by 5.5 per cent. However, the actual growth surpassed these projections, highlighting stronger-than-anticipated momentum in industrial activity.

Within the manufacturing sector, most industries recorded positive growth. Out of 23 industry groups at the two-digit NIC level, 16 groups reported an increase in output during December. Some of the top-performing segments included computer, electronic and optical products, which saw a sharp rise of 34.9 per cent. Motor vehicles, trailers and semi-trailers registered a growth of 33.5 per cent, while other transport equipment expanded by 25.1 per cent.

Basic metals production also showed a notable increase of 12.7 per cent in December. This growth was supported by higher output of alloy steel flat products, MS slabs, and steel pipes and tubes. Pharmaceutical manufacturing grew by 10.2 per cent, helped by increased production of vaccines, digestive medicines, and vitamin formulations, according to the data.

When analysed by use-based classification, infrastructure and construction goods recorded a strong growth of 12.1 per cent in December. Consumer durables also performed well, registering a growth of 12.3 per cent. These figures highlighted continued momentum in capital expenditure-led activity and discretionary consumption.

Capital goods output rose by 8.1 per cent, while intermediate goods recorded a growth of 7.5 per cent. These trends pointed toward strengthening investment and production pipelines in the economy. Primary goods output also increased by 4.4 per cent during the month.

On a cumulative basis, industrial production grew by 3.9 per cent during the period from April to December 2025-26. This reflected steady expansion in industrial activity despite some fluctuations earlier in the year. The government also carried out a final revision of November 2025 data, which confirmed the upward trend in headline industrial growth toward the end of the year.

The December performance highlighted the strengthening of India’s industrial momentum and indicated sustained activity across multiple sectors. The combined growth in manufacturing, mining, electricity, infrastructure, and consumer segments suggested a broad-based improvement in industrial output as the year came to a close.