India’s core sector growth slowed sharply in May 2026, with the combined output of eight key infrastructure industries expanding by just 0.5% year-on-year, according to provisional data released by the Ministry of Commerce and Industry on Monday.
The slowdown comes amid sharp declines in production across major sectors such as coal, crude oil, natural gas and petroleum refinery products, even as steel, cement and electricity generation posted healthy growth during the month.
Core industries see marginal growth in May
The Index of Eight Core Industries (ICI), which tracks the performance of eight crucial sectors and accounts for 40.27% of the weightage in India’s Index of Industrial Production (IIP), recorded marginal growth compared to May 2025.
The ministry said the final growth rate for April 2026 stood at 1.8%, while cumulative core sector growth during April-May 2026-27 was estimated at 1.1%, lower than the corresponding period last year.
Coal output drops over 9%
Coal production, which carries a weightage of 10.33% in the index, witnessed one of the sharpest contractions during the month. Output declined 9.3% in May 2026 compared to the same period last year, while cumulative production during April-May fell 9.1% year-on-year.
Oil and gas production remains under pressure
India’s energy-related sectors continued to remain under pressure during the month. Crude oil production fell 4.6%, while cumulative output during the first two months of the fiscal declined 4.2%. Natural gas production also contracted 4.9% in May, with cumulative output down 4.5%.
Petroleum refinery products, the heaviest weighted sector in the index at 28.04%, recorded a significant 8.7% decline, while cumulative refinery production fell 4.7%.
Fertiliser production slips slightly
Fertiliser production also remained weak during the month. The sector, which carries a 2.63% weightage, recorded a 0.9% decline in May, while cumulative production dropped 4.5% during April-May.
Despite weakness in several sectors, strong performances in steel, cement and electricity prevented a sharper slowdown in overall core sector growth. Steel production grew 5% year-on-year in May, with cumulative growth at 5.2% during the first two months of the fiscal year.
Cement production emerged as one of the top performers, rising 8.4% in May, while cumulative output increased 8.3%.
According to the commerce ministry, electricity generation recorded the strongest growth among all eight sectors, expanding 8.7% in May, with cumulative growth at 7.1%.
