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India's industrial production expanded by 7.3% year-on-year in June 2026, registering its strongest growth in 23 months, according to the latest government data. The increase was led by manufacturing, which grew 7.8%, while electricity and gas supply recorded the highest sectoral growth at 10.6%. Water supply, sewerage and waste management rose 6.1%, and mining and quarrying increased 1%. The broad-based expansion reflects improving industrial activity, supported by domestic demand and infrastructure development. Industry stakeholders said sustained access to capital, particularly for micro, small and medium enterprises (MSMEs), would be essential to maintaining production growth and supporting investment, employment and long-term economic expansion.
India's industrial activity accelerated in June 2026, with the Index of Industrial Production (IIP) rising 7.3% year-on-year, marking the strongest monthly growth recorded in the past 23 months, according to the latest government data. The expansion was driven by broad-based growth across manufacturing, utilities and other industrial sectors, reflecting improving domestic demand and continued economic momentum.
Manufacturing, which accounts for the largest share of the IIP, registered a 7.8% increase during the month, making it the principal contributor to overall industrial growth. The electricity and gas supply segment recorded the highest sectoral expansion at 10.6%, indicating rising energy demand from industrial and commercial users as economic activity gathered pace.
Other segments also reported positive performance. Water supply, sewerage and waste management grew by 6.1% during the month, while mining and quarrying recorded a more modest increase of 1%, contributing to the overall improvement in industrial production.
The latest figures indicate that India's industrial growth has become increasingly broad-based, supported by stronger manufacturing output, continued infrastructure activity and sustained domestic consumption. The data also reinforces expectations that industrial production will remain an important contributor to overall economic growth in the coming quarters.
Commenting on the latest IIP figures, Shrikant Goyal, Co-founder of Getfive, said the 7.3% year-on-year expansion was encouraging, particularly against the backdrop of continuing global economic uncertainties. He stated that maintaining the current growth momentum would be important for the broader economy and emphasised that micro, small and medium enterprises (MSMEs) would remain central to sustaining industrial expansion because of their significant contribution to manufacturing output and employment.
Goyal further said that ensuring timely and adequate access to capital would enable MSMEs to scale their operations and benefit from emerging business opportunities. He added that continued support from the government and regulators, including the Reserve Bank of India (RBI) and the Securities and Exchange Board of India (SEBI), to strengthen financing channels would help MSMEs meet their funding requirements through debt, equity or a combination of both, thereby supporting long-term industrial development.
The latest industrial production data also suggests that India's manufacturing sector continues to serve as the primary engine of industrial expansion despite persistent global economic challenges. With growth recorded across multiple sectors, the figures point to resilient domestic demand and sustained industrial activity, reinforcing confidence in the country's economic outlook and supporting expectations of continued investment and employment generation.
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