Story perspectives

India’s June industrial output climbs 7.3%, new price index debut.

7/29/2026

Summary

India Industrial Surge

India's industrial output rose 7.3% year-on-year in June, the fastest increase since July 2024.
Manufacturing output grew 7.8% year-on-year in June, up from a revised 5.2% rise in May.
Electricity and gas supply expanded 10.6% year-on-year in June, compared with 10.3% in May.
Mining activity increased 1.0% year-on-year in June after a 1.4% decline in May.

Summary

RBI Holds Rates

The Reserve Bank of India kept interest rates unchanged in June because strong industrial output showed no inflation pressure.
The Production Linked Incentive scheme was cited as the catalyst for June’s manufacturing and capital-goods gains.
Capital-goods output rose 14.2% YoY, with the index at 140.5.
Food-processing output climbed 10.8% YoY, driven by tea, non-basmati rice and starch.
June’s IIP survey had an 86.7% response rate, down from 93.1% in May.

Summary

MoSPI Revamps Index

Ministry of Statistics and Programme Implementation (MoSPI) replaced the Wholesale Price Index with the Output Producer Price Index as IIP’s deflator, using 2022-23 as base year.
The shift affects 234 of 463 groups, representing 36.02% of the index’s weight, and supersedes WPI-based IIP 2022-23 series released on 1 June 2026.
The change aims for a detailed price structure and better real-output measurement, with July 2026 data on 28 August 2026.

History

Historical Context

Facing a 1991 balance-of-payments crisis that left reserves enough for just three weeks of imports, Prime Minister P. V. Narasimha Rao and Finance Minister Manmohan Singh devalued the rupee in July and dismantled the Licence Raj, slashing licensing and opening FDI (averaging $200 million annually 1985-91). The reforms spurred industrial growth, reflected in June 2026’s 7.3% output rise, unchanged RBI rates, and the Production-Linked Incentive scheme driving manufacturing.

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India Industrial Surge

India's industrial output rose 7.3% year-on-year in June, the fastest increase since July 2024.
Manufacturing output grew 7.8% year-on-year in June, up from a revised 5.2% rise in May.
Electricity and gas supply expanded 10.6% year-on-year in June, compared with 10.3% in May.
Mining activity increased 1.0% year-on-year in June after a 1.4% decline in May.

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