India's industrial output growth slows to 6.7% in September as mining contracts 6.2%

India's industrial production growth moderated to 6.7% in September 2026 from a downward-revised 7.8% in August, as a contraction in mining output and slower manufacturing activity weighed on overall growth, according to data released on October 28. Despite the moderation in September, industrial production expanded 7.3% in the second quarter of FY27, compared with 6.2% in the April-June quarter. For the first six months of the financial year, industrial production grew 6.8%, compared with 4.4% in the corresponding period last year. Manufacturing remains resilient, mining drags Manufacturing, which accounts for more than three-fourths of the Index of Industrial Production (IIP), expanded 7.6% in September, slowing from 8.6% in August. Electrical equipment manufacturing recorded particularly strong growth of 33.9%, followed by rubber and plastics products at 19.9% and motor vehicles, trailers and semi-trailers at 19%. Other transport equipment production increased 19.1%, while textile manufacturing expanded 17.4%. Pharmaceutical production contracted 8.9%, while wearing apparel output declined 5.2%. Chemicals and chemical products recorded a marginal contraction of 0.6%. Mining and quarrying output contracted 6.2% in September, compared with a 4.6% decline in August, making it the principal drag on industrial activity. Within mining, non-metallic minerals production plunged 29.2%, while metallic minerals output rose 14%. Electricity and gas supply output expanded 11.2%, moderating from 12.3% in August. Electricity generation from non-renewable sources increased 16.5%, while renewable electricity generation grew 4.3%. Capital goods maintain double-digit growth The use-based classification of industrial production showed continued strength in investment-linked categories, although growth moderated across most segments. Capital goods production increased 10.4% in September, compared with 15.9% in August, maintaining double-digit growth for the sixth consecutive month. Intermediate goods output expanded 12.2%, compared with 14.2% in August, marking the fifth consecutive month of double-digit growth. Infrastructure and construction goods production rose 7.2%, slowing from 8% in August, while primary goods growth eased to 4% from 4.2%. On the consumption side, consumer durables output expanded 6%, compared with 10.5% in August. Consumer non-durables production, however, recovered to grow 1.4% after contracting 1.1% in the preceding month. "With IIP growth accelerating to a robust 7.3% in Q2 FY2027 from 6.2% in Q1 FY2027, complementing the strength visible across high-frequency indicators, we anticipate GDP growth to exceed 7.0% in Q2 FY2027," Aditi Nayar, chief economist at ICRA, said.