New Delhi, June 23, 2026: Growth in India’s eight core infrastructure industries slowed sharply to 0.5% in May 2026, marking the second-weakest performance in the past 21 months and raising concerns about the pace of industrial activity in the country.
Official data showed that five of the eight core sectors recorded a contraction during the month, highlighting broad-based weakness across key segments of the economy. The only weaker performance during the last 21 months was recorded in October 2025, when core sector output contracted by 0.1%.
The slowdown was primarily driven by declines in petroleum-related industries, including crude oil, natural gas, and refinery products. The refinery products segment witnessed one of the steepest declines, registering a contraction of 8.7%, its weakest performance in more than three years.
Crude oil production fell by 4.6% during May, while natural gas output declined by 4.9%, reflecting continued challenges in domestic energy production. Analysts believe changing global energy dynamics, softer international crude prices, and evolving supply chain conditions contributed to the weak performance.
The coal sector also recorded a significant decline, contracting by 9.3%, the sharpest fall in nearly a year. Meanwhile, the fertilizer industry remained under pressure, posting its third consecutive monthly contraction, although the pace of decline moderated compared to previous months.
Despite the broader slowdown, some sectors continued to show resilience. Electricity generation emerged as one of the strongest performers, growing 8.7% during the month. The increase was partly supported by a lower base from the previous year and rising seasonal demand.
The cement sector also maintained positive momentum, recording growth of 8.4%, while steel production expanded by 5%. Although steel output remained in positive territory, growth eased to its slowest pace in over a year.
Economists noted that the latest data indicates continued pressure on industrial activity, particularly in energy-related sectors. Since core industries account for a significant share of India’s industrial production, their performance is often viewed as an important indicator of broader economic trends.
Market observers will closely monitor upcoming industrial production and economic growth data to assess whether the slowdown represents a temporary weakness or signals broader challenges for the economy in the coming months.
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