March 2025 IIP tapers to 2.7%; even as manufacturing IIP picks up

29 May 2025 , 09:17 AM

APRIL 2025 IIP AT 2.7%; MANUFACTURING GATHERS STEAM

IIP growth edged lower to 2.7% in April 2025; from 3.94% (revised up from 3.00%) in March 2025. This is the second month when IIP has been announced early and is giving a good basis for juxtaposing IIP and CPI. In terms of revisions, the IIP growth for March was revised up by 94 bps from 3.00% to 3.94%. However, final revision for January 2025 saw no change.

In terms of yoy IIP, manufacturing got a boost, while mining and electricity lagged. For April 2025; mining growth dipped to -0.2% from 1.2% in March (down 140 bps). Manufacturing growth was at 3.4% for April, with March manufacturing IIP revised up from 3.0% to 4.0%. Electricity production in April 2025 was lower at 2.7%, compared to 3.9% in March 2025.

High frequency MOM IIP showed a sharp dip, led by mining sector. For April 2025, the MOM mining output contracted -17.4%, manufacturing contracted -7.9%, while electricity contracted by -2.3%. As a result, overall IIP also contracted by -8.6% MOM; displaying mounting pressure on IIP in terms of high-frequency indicators, due to macro uncertainty.

IIP GROWTH STORY IN LAST 1 YEAR

Despite the recovery post August 2024, IIP numbers have been increasingly volatile.

Month	IIP Growth (%)
Apr-24	5.19%
May-24	6.25%
Jun-24	4.93%
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	2.70%

Data Source: MOSPI

IIP numbers appear to have gotten over the sharp fall in August 2024, although it is very volatile in recent months. April IIP does not reflect the bunching impact of US tariffs, but that could reflect in May 2025. If you look at IIP growth in previous 6 months, it averaged 4.0%, while it averaged 4.1% in the 6 months prior to that. At a broad level, the median IIP appears to be converging around the 4.0% level, which is a good sign, on an elevated base.

APRIL 2025 IIP: DISSECTING IIP PRODUCT BASKET

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

Product Basket	Weights	Feb-25	Mar-25	Apr-25
Manufacture of food products	5.3025	-6.1	-7.6	1.3
Manufacture of beverages	1.0354	-2.6	7.4	-1.4
Manufacture of tobacco products	0.7985	-1.3	23.8	25.9
Manufacture of textiles	3.2913	2.5	5.7	1.7
Manufacture of wearing apparel	1.3225	-3.3	1.3	10.8
Manufacture of leather products	0.5021	-9.0	-7.4	-1.3
Manufacture of wood products	0.1930	5.0	5.2	24.4
Manufacture of paper products	0.8724	-8.8	-5.8	-2.4
Printing and recorded media	0.6798	-11.1	-10.3	0.1
Manufacture of coke and refined petroleum	11.7749	0.5	2.5	-2.1
Manufacture of chemical products	7.8730	-2.8	-1.9	-3.6
Manufacture of pharmaceuticals	4.9810	3.0	-4.3	-3.9
Manufacture of rubber and plastics	2.4222	3.9	2.2	7.6
Manufacture of other non-metallic minerals	4.0853	8.2	8.9	5.6
Manufacture of basic metals	12.8043	5.2	8.7	4.9
Manufacture of fabricated metal products	2.6549	6.8	-4.0	12.7
Manufacture of computer, electronic	1.5704	11.2	22.6	10.5
Manufacture of electrical equipment	2.9983	9.5	16.1	15.2
Manufacture of machinery and equipment	4.7653	2.8	8.9	17.0
Manufacture of motor vehicles, trailers	4.8573	8.9	11.3	15.4
Manufacture of other transport equipment	1.7763	8.2	-6.0	2.4
Manufacture of furniture	0.1311	2.7	-19.2	1.3
Other manufacturing	0.9415	-6.4	-2.0	-20.3
MINING	14.3725	1.6	1.2	-0.2
MANUFACTURING	77.6332	2.8	4.0	3.4
ELECTRICITY	7.9943	3.6	7.5	1.1
OVERALL IIP	100.0000	2.7	3.9	2.7

Data Source: MOSPI

Let us first look at the positive drivers of IIP growth. The positive thrust came largely from sectors like Tobacco, Wood Products, Machinery & Equipment, Motor Vehicles, Electrical Equipment, Fabricated Metals, Wearing Apparel, and Computers & Electronics. These 8 sectors averaged 16.5% IIP growth in April 2025.

The negative pressure on IIP came from Other Manufacturing, Pharma, Chemicals, Paper, petroleum products, beverages, leather, and recorded media. Trump tariff uncertainty resulted in trade pressure shifting back from domestic demand to weak export demand. The good news is that the positive movers are comparatively up the value chain!