Within the Index, the coal sector saw the largest contraction, of 12.3%, in July 2025. Representational file image.
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Growth in industrial activity in India’s eight core industries slowed to 2% in July 2025, dragged down by contractions in the fossil fuel categories, according to data released on Wednesday (August 20, 2025). Steel and cement sectors, however, witnessed double-digit growth.
The Index of Eight Core Industries, released by the Ministry of Commerce and Industry, shows that activity in July 2025 is relatively significantly slower than the 6.3% growth seen in July last year. The Index grew by 2.2% in June 2025.
Within the Index, the coal sector saw the largest contraction, of 12.3%, in July 2025. This is the second consecutive month of contraction for the sector, and its worst performance in at least five years.
The natural gas sector contracted 3.2% in July 2025, its thirteenth consecutive month of contraction. Similarly, the crude oil sector also contracted, by 1.3%, for the fourteenth month out of the last 15. It had briefly grown in December 2024.
As a result, the refinery products sector too witnessed a contraction of 1.05% in July 2025, the sector’s worst performance since April 2025.
“Besides demand being low, there also is a correlation with global crude oil prices that have been stable in the $60-70/bbl range,” Madan Sabnavis, Chief Economist at the Bank of Baroda, explained. “This is also indicative of slowing consumption of end-products like petrol and diesel which can be partly explained by the growing importance of EVs especially in the passenger car segment.”
The steel and cement sectors, however, witnessed robust double-digit growth of 12.8% and 11.7%, respectively. This is the strongest performance for the steel sector in 21 months, and the best performance for the cement sector in four months.
The fertilisers sector also saw growth in July 2025, of 2%, snapping a three-month streak of contractions. The electricity sector also registered a growth in July 2025, albeit of 0.5%, although this too came after two consecutive months of contraction.
Published – August 20, 2025 06:06 pm IST
