Momentum in industrial growth indicates improving domestic demand amid tax rationalization measures such as targeted GST reduction: PHDCCI

The momentum in industrial growth, particularly in manufacturing and construction-related segments, indicates improving domestic demand and rising capacity utilization amid continued policy support coupled with tax rationalization measures such as targeted GST reduction, according to Secretary General and CEO, Dr. Ranjeet Mehta.

Mr. Rajeev Juneja, President, PHDCCI said that the Index of Industrial Production (IIP) registered a year-on-year growth of 4% (Quick Estimate) in September 2025, driven by notable acceleration in the manufacturing and electricity sectors. The manufacturing sector grew by 4.8% in September 2025 as compared to the corresponding period of the previous year, improving from a growth rate of 4% in September 2024 over September 2023. The electricity sector also witnessed a healthy expansion of 3.1% on a year-on-year basis in September 2025 from 0.5% in September 2024, he said.

The robust performance of the manufacturing sector was largely driven by double-digit growth in key industries such as the manufacture of basic metals, electrical equipment, computer, electronic and optical products, motor vehicles, trailers and semi-trailers, and wood and wood products, Mr. Juneja added. In contrast, the mining sector recorded a marginal contraction of (-) 0.4% in September 2025 compared to 0.2% in September 2024, he said.

Among the use-based categories, construction goods and consumer durables registered impressive growth of 10.5% and 10.2%, respectively, during September 2025 over September 2024. This was followed by growth in intermediate goods (5.3%), capital goods (4.7%), and primary goods (1.4%), reflecting a broad-based expansion in industrial activity, he said.

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