A loader loads coal in the truck at an open cast coal field at Topa coal mine in the Ramgarh district in the eastern Indian state of Jharkhand.
Credit: Reuters Photo
New Delhi: Output of the core infrastructure sector grew by 6.3 per cent in August, the fastest pace of expansion in 15 months, led by favourable base effect and robust performance of coal, steel and cement sectors, official data showed on Monday.
The August performance of the key infrastructure sector measured in terms of the Index of Eight Core Industries was the best since May 2024. In July 2025, the core sector growth stood at 3.7 per cent.
Steel sector was the best performing with 14.2 per cent year-on-year growth recorded during the month under review. It was followed by an 11.4 per cent jump in output coal and 6.1 per cent increase in cement production.
Electricity generation in August 2025 was 3.1 per cent when compared with the same month last year, while fertilizer production increased by 4.6 per cent, data released by the Ministry of Commerce and Industry showed.
However, crude oil and natural gas segments continued to underperform. Natural gas production in August 2025 was 2.2 per cent lower when compared with the same month last year. Cumulative production in the April-August period of the current financial year is 2.5 per cent lower year-on-year.
There was a similar story in the crude oil segment. Crude oil output declined by 1.2 per cent year-on-year in August. On a cumulative basis for the first five months of the current financial year the crude oil production was 1.7 per cent lower year-on-year.
The core sector has a weight of 40.27 per cent in the Index of Industrial Production (IIP).
“The pickup in growth in infrastructure sector output is expected to keep the IIP growth at around 5.5 per cent YoY in August 2025. We expect the core sector output growth at around 5 per cent YoY in September 2025,” said Paras Jasrai, Associate Director, India Ratings and Research.
The cumulative output growth in the core infrastructure sector in April-August period of 2025-26 stood at 2.8 per cent as compared to the corresponding period of last year.
ICRA Chief Economist Aditi Nayar said the uptick in the core sector growth in August was particularly driven by coal, which witnessed an expansion of 11.4 per cent in the month, following a double-digit contraction in July 2025.
Overall, five of the eight sectors, barring steel, cement, and electricity saw an improvement in their YoY growth performance in August 2025 vis-à-vis July 2025. Although the growth in cement sector output stood relatively better at 6.1 per cent, it remained at a 10-month low in view of the monsoon fury in various parts of the country in August.