Iron ore, cement, power output propels June core growth to 5%

New Delhi: India's core sector output growth hit a five-month high of 5% year-on-year in June, accelerating from 3.2% in May on the back of a surge in iron ore production and sustained growth in cement and electricity, showed official data released on Monday.

The June data is the first to be published under a revised index with 2022-23 as the new base year, replacing 2011-12. The updated series also includes iron ore, bringing the number of core industries to nine.

For the April-June quarter, cumulative core sector growth increased to 3.6% from 1% in the year-ago period. On the revised series, growth for 2025-26 stood at 3%, lower than 4.3% in 2024-25.


"Coal and iron ore output witnessed a marked improvement in their growth performance in June relative to May, with the lull in rainfall in the month supporting mining activity," said Rahul Agrawal, principal economist at ICRA.

Iron ore production expanded 43.9% year-on-year in June from 19% in May, while coal output returned to positive territory, increasing 1.4% after contracting 9.5% in the previous month.

Madan Sabnavis, chief economist at Bank of Baroda, said that the thrust areas, steel and cement, continued to boost growth, aided by both private sector and government spending.

Cement output increased 9.8% in June, its fastest pace in five months, compared with 8.4% in May. Steel production went up 4.6%, slackening from 5.1% a month earlier.

Electricity generation remained robust, increasing 9.8% in June, though slower than the 11.2% growth recorded in May.

"Higher demand by industry as well as households due to heatwaves in some parts added to demand," said Sabnavis.

In contrast, crude oil, natural gas and refinery products remained under pressure, contracting 4.2%, 7.4% and 4.7%, respectively, during the month.

Sabnavis attributed the decline to higher imports amid softer global crude prices and weaker exports of refined petroleum products.

Fertiliser production also remained weak, shrinking 3.3% in June after a 1% contraction in May, marking its fourth consecutive month of decline.

Agrawal said the continued weakness in fertiliser output likely reflects the lingering impact of tensions in West Asia.