India Core Sector Growth Slows To 0.5% In May 2026 Amid Output Contractions

India’s eight core industries recorded a slowdown in growth to 0.5% in May 2026, according to official data. This marks a decline from the revised growth of 1.8% reported in April 2026.

The moderation was driven by contractions in key sectors such as coal and petroleum products. The data was released by the Ministry of Commerce and Industry.

India Core Sector Growth May 2026 Data

The Index of Eight Core Industries (ICI) expanded by 0.5% in May 2026, marking the slowest growth since October 2025. Five of the eight sectors registered a decline in production during the month.

The core sectors together account for around 40% of the Index of Industrial Production (IIP). Cumulatively, the index grew 1.1% during April–May 2026-27, matching the same period in the previous year.

Petroleum And Coal Output Decline Impact

Petroleum refinery products, which have the highest weight of 28.04 in the index, recorded a contraction of 8.7% in May 2026. This represents a significant fall compared to a contraction of 0.5% in April 2026.

Coal output declined by 9.3%, marking a 10-month low for the sector. These contractions contributed notably to the overall slowdown in core sector growth.

Performance Of Other Declining Sectors

Crude oil production contracted by 4.6% in May 2026 compared to a decline of 3.9% in April 2026. Natural gas output also declined by 4.9%, representing a 3-month low.

Fertiliser production continued to contract, though the pace slowed to 0.9% compared to 8.6% in April 2026. These declines indicate reduced output across multiple energy and input-related sectors.

Electricity, Cement, and Steel Sector Growth

Electricity generation increased by 8.7% in May 2026, marking a 24-month high compared to 5.6% growth in April 2026. The electricity index reached an all-time high of 237.5 under the 2011-12 series.

Cement production grew by 8.4%, while steel output recorded a growth of 5% during the month. These sectors were the only contributors that remained in positive territory during the period.

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Conclusion

India’s core sector growth slowed to 0.5% in May 2026 due to declines in coal, petroleum, and other energy-related sectors. The data shows that five out of eight core industries recorded contraction during the month.

At the same time, electricity, cement, and steel sectors posted growth, partially offsetting the overall slowdown. The cumulative growth for April–May 2026-27 remained stable at 1.1% compared to the previous year.

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