India industrial growth slows to 2%
- Union Bank of India said India’s industrial output likely slowed to 2% in March 2026, from 5.2% in February, as factories and utilities weakened. - The sharpest warning sign came earlier: India’s eight core industries contracted 0.4% in March, with fertiliser output down 24.6% year on year. - The slowdown landed as Middle East disruptions pushed up costs and rattled supply chains. (pmi.spglobal.com)
India’s industrial output likely slowed sharply in March, with Union Bank of India projecting 2% growth after 5.2% in February. (thehindubusinessline.com) The bank said weakness was broad-based across manufacturing and energy, with rising input costs and supply disruptions weighing on output. It pegged March 2026 industrial growth below both February 2026’s 5.2% and March 2025’s 3.9%. (economictimes.indiatimes.com) A key reason is that the eight core industries, which carry 40.27% weight in the Index of Industrial Production, fell 0.4% in March on a provisional basis. That was the first contraction in five months, and the weakest reading in 19 months. (pib.gov.in) (news18.com) Government data showed four core sectors shrank in March: fertilisers, crude oil, coal and electricity. Fertiliser output dropped 24.6%, coal fell 4.0%, crude oil slipped 1.9%, and electricity declined 0.7%. (pib.gov.in) Factory surveys were already flashing strain. S&P Global’s HSBC India Manufacturing Purchasing Managers’ Index fell to 53.9 in March from 56.9 in February, the lowest since June 2022, while staying above the 50 mark that signals expansion. (pmi.spglobal.com) S&P Global said output and new orders slowed as firms faced higher costs for aluminium, chemicals and fuels, along with uncertainty linked to the Middle East conflict. Companies raised selling prices more slowly than input costs, suggesting margins were being squeezed. (pmi.spglobal.com) The March core-sector drop also capped a weak year for the infrastructure-heavy industries that feed the broader factory index. Cumulative growth in the eight core industries slowed to 2.6% in fiscal 2025-26, the lowest since the pandemic-hit 2020-21 year. (pib.gov.in) (thehindu.com) India’s official March industrial production data will determine whether that 2% estimate holds. For now, the March readings show an economy still growing, but with factories, fuel-linked sectors and utilities losing momentum at the same time. (tradingeconomics.com) (thehindubusinessline.com)
