Industrial growth quickens to 8% in August on broad-based uptick

Industrial growth in India quickened to 8% in August 2026 from 7.35% a month earlier, driven by a strong performance in the manufacturing, electricity, capital goods, and consumer goods sectors.

Growth in the Index of Industrial Production, data on which was released by the Ministry of Statistics and Programme Implementation on Monday, was last quicker in June 2026 when it touched 8.8%. 

The growth in August is the second-highest for the period going back to April 2024 for which the new series of the IIP has data. 

“This [August growth] was aided by sharp growth in capital goods, intermediate, infrastructure, and consumer durable goods,” Madan Sabnavis, chief economist at the Bank of Baroda said. 

“For the five months period, growth was at 6.7%,” Mr. Sabnavis added. “If this is maintained, India can register growth of 7-8% for the year on the back of higher growth during the festival season with demand building up. This makes the third quarter very critical for industry.”

The manufacturing sector grew at 8.95% in August 2026, the second-highest in the history of the new series of the IIP after the 9.5% seen in June 2026. A deeper look showed that the growth in the sector was driven by motor vehicles, electric and non-electric machinery, electronics, textiles, beverages, rubber, and non-metallic products.

The electricity sector saw growth quicken to a 27-month-high of 12.3% in August 2026, which, according to Mr. Sabnavis, was supported by growth in both conventional and renewable electricity. 

The capital goods sector grew by 16.9%, which was however a three-month low. This growth came on a relatively high base of 6% in August 2025.  

The consumer durables sector grew 11.1% in August 2026, marginally slower than the 12% seen in the previous month. The consumer non-durables sector returned to a growth of 2.05% after having contracted 0.8% in July 2026.