Core sector industries output, as measured by the Index of Core Industries (ICI) stood at 7.9% in September, up from 5.9% in August, according to data released by Ministry of Commerce and Industry on Wednesday. September output was the highest growth in the new ICI series, which has 2022-23 as its base year.
“Coal and iron ore output witnessed a meaningful pickup in their YoY growth rates in September 2026 compared to August 2026; while this was aided by a low base, the sequential uptick in coal was quite strong, amid low stocks at power plants,” said Aditi Nayar, chief economist at ICRA Ltd. “Growth in electricity generation eased somewhat to 11.4% in September 2026 from 13.1% in August 2026, albeit remaining quite strong, as the monsoon deficit supported demand in the month,” Nayar added.
The sub-sectors that contracted in August were fertilisers, natural gas and crude oil. The contractions in both natural gas and crude oil output narrowed compared to August. While fertilisers output remained in contraction for only twelve months.
Fertilisers output saw the deepest contraction of 11.7% in the index in August, though it has improved from 12.4% contraction observed in last month. Natural gas output contracted by 4.6%, followed by crude oil which contracted 1.4%. Out of the 30-month data available from April 2024 in the new series, crude oil and natural gas were in contraction in 28 and 27 months, respectively.
Because of shortage of raw materials because of ongoing West-Asia war, as India imports these raw materials, the contraction in these three industries would likely be.
To be sure, crude oil and natural gas output remained negative even before the war started.
