July 2025 IIP bounces to 3.47%; as manufacturing bounces

29 Aug 2025 , 11:16 AM

JULY 2025 IIP AT 3.47%; MANUFACTURING OUTPERFORMS

IIP growth for July 2025 bounced to 3.47%.There was no revision to the June 2025 IIP number. However, what is interesting is that the corresponding growth in IIP in the year-ago period was 4.98%, but fell to 0.00% in August 2024. Therefore, a further upside to the IIP in August 2025 also appears likely, based on the base adjustment grounds.

In terms of yoy IIP growth, mining contracted by -7.2%, largely due to monsoon impact. Manufacturing IIP improved from 3.7% to 5.4% over the previous month. Electricity IIP improved from -1.2% to +0.9%, finally a turnaround into the positive zone. Four-month IIP growth overall stood at 2.5%, with mining and electricity contracting, and manufacturing positive.

High-frequency MOM IIP showed short-term recovery. For July 2025, the MOM mining contracted sharply by -12.58%, manufacturing grew +3.22%, while electricity also grew by +0.64%. As a result, overall IIP also grew by +1.11% MOM. Despite domestic confidence, global constraints remain an overhang on output growth..

IIP GROWTH STORY IN LAST 1 YEAR

Despite being positive post August 2024, IIP has become very volatile of late.

Month	IIP Growth (%)
Jul-24	4.98%
Aug-24	0.00%
Sep-24	3.23%
Oct-24	3.73%
Nov-24	4.96%
Dec-24	3.74%
Jan-25	5.21%
Feb-25	2.72%
Mar-25	3.94%
Apr-25	2.57%
May-25	1.87%
Jun-25	1.52%
Jun-25	3.47%

Data Source: MOSPI

The IIP bounce to 3.47% in July 2025 is due to base effect and also due to a pick-up in manufacturing. Most of this pressure is coming from mining and electricity. The last time, IIP growth was under 2% for 2 months in a row was in Jan-22 and Feb-22.  If you look at IIP growth in previous 12 months, it averaged 3.21%, while it averaged 2.97% in last 6 months. Median IIP is diverging from the 3.5% level; and current levels are sharply lower.

JULY 2025 IIP: DISSECTING IIP PRODUCT BASKET

The table captures comparative IIP growth for last 3 months, with respective components.

Product Basket	Weights	May-25	Jun-25	Jul-25
Manufacture of food products	5.3025	1.7	0.2	-1.3
Manufacture of beverages	1.0354	-3.7	-7.6	-6.3
Manufacture of tobacco products	0.7985	5.7	2.3	10.8
Manufacture of textiles	3.2913	-3.0	1.5	-1.4
Manufacture of wearing apparel	1.3225	2.3	4.0	3.2
Manufacture of leather products	0.5021	-4.6	-3.0	-3.0
Manufacture of wood products	0.1930	2.1	0.6	17.3
Manufacture of paper products	0.8724	-4.4	-3.1	-2.8
Printing and recorded media	0.6798	-16.1	-10.1	-10.7
Manufacture of coke and refined petroleum	11.7749	1.1	4.5	1.1
Manufacture of chemical products	7.8730	-4.0	-3.9	-1.9
Manufacture of pharmaceuticals	4.9810	-0.6	0.9	3.6
Manufacture of rubber and plastics	2.4222	8.4	0.2	-3.0
Manufacture of other non-metallic minerals	4.0853	6.9	3.0	9.5
Manufacture of basic metals	12.8043	7.8	9.2	12.7
Manufacture of fabricated metal products	2.6549	-0.1	14.9	10.0
Manufacture of computer, electronic	1.5704	-4.9	-0.3	4.1
Manufacture of electrical equipment	2.9983	7.8	4.6	15.9
Manufacture of machinery and equipment	4.7653	10.6	5.3	5.9
Manufacture of motor vehicles, trailers	4.8573	6.2	4.0	7.3
Manufacture of other transport equipment	1.7763	6.5	0.5	11.5
Manufacture of furniture	0.1311	-5.7	10.2	6.6
Other manufacturing	0.9415	-15.3	-17.3	-14.3
MINING	14.3725	-0.1	-8.7	-7.2
MANUFACTURING	77.6332	3.2	3.7	5.4
ELECTRICITY	7.9943	-4.7	-1.2	0.6
OVERALL IIP	100.0000	1.9	1.5	3.5

Data Source: MOSPI

Let us first look at the positive drivers of IIP growth. The positive thrust came largely from sectors like Wood Products, Electrical Equipment, Basic Metals, Transport Equipment, Tobacco Products, Fabricated Metals, and Mineral Products. These 7 sectors averaged 12.3% IIP growth in July 2025.

The negative pressure on IIP came from Other Manufacturing, Printing & Recorded Media, Beverages, Beverages, Rubber Products, and leather products. These 5 products averaged contraction of -7.5% in July 2025. The picture looks a lot more mixed as there are export oriented sectors in big gainers and big losers. Global constraints are becoming less significant as a driving factor of IIP!