Output of India's core infrastructure industries grew 7.9% in September from a year earlier, the fastest pace since the index moved to its new 2022-23 base, according to data released by the Ministry of Commerce and Industry on Oct. 21. Growth picked up from 5.9% in August, which the ministry revised up from an initial 4.8%.

For investors in Asia, the reading is an early signal for India's industrial production report and for second-quarter growth. Power, coal, steel and cement feed directly into construction and factory activity, which matters to the region's suppliers of commodities and machinery to India.

Coal, Power and Refineries Lead India's Core Sector

Six of the nine industries in the revamped index grew in September, according to the ministry's figures as reported by SteelOrbis. Iron ore led with an 18.4% increase. Electricity generation rose 11.4%, coal output 10.7% and refinery products 10.3%. Cement rose 9.8% and steel 4.9%.

The swing in coal was the sharpest. Output had fallen 3.8% in August, according to the Dalal Street Investment Journal, before rising by double digits in September. Refinery products also accelerated from 5.6% growth in August. Steel growth quickened from 3.5%, and iron ore, which rose 5.5% in August, more than tripled its pace. Electricity and cement, by contrast, grew more slowly than in August, when they rose 13.1% and 11.7%.

Three industries contracted. Fertilizer output fell 11.7%, its seventh straight monthly decline, according to the Dalal Street Investment Journal. Natural gas production dropped 4.6% and crude oil 1.4%.

Part of the jump reflects a soft comparison. Core output grew 3.1% in September 2025. Even so, growth for April through September reached 5.1%, compared with 2.5% in the same period a year earlier. SteelOrbis described the September figure as a 30-month high.

The September numbers are provisional and are often revised. The ministry raised the August index to 120.4 from 119.2 when it published the new data.

HSBC Flash PMI Shows Export Orders Picking Up

Survey data for October point to steady, though not accelerating, factory momentum. HSBC's flash India manufacturing purchasing managers' index, compiled by S&P Global, eased to 54.9 from 55.1 in September, according to Swarajya's report on the Oct. 23 release. Any reading above 50 indicates expansion. Flash readings are based on most of the monthly survey responses, so the final figure can differ.

The broader picture was firmer, with private sector activity at a four-month high. The flash composite index, which combines manufacturing and services, rose to 56.7 from 55.9, above the 56.1 forecast in a Reuters poll, Swarajya reported. The services activity index climbed to 56.2 from 55.2, and the manufacturing output index edged up to 57.6.

Export demand was the standout. New export orders for manufacturers grew at their fastest rate since June 2025. Pranjul Bhandari, chief India economist at HSBC, said output and new orders grew at about the same pace as in September while export demand picked up notably.

Price pressure kept easing. Input cost inflation slowed for a seventh straight month to its lowest in almost a year, and factory selling price growth was the weakest in nearly four years, according to the survey. Hiring was the weak spot: overall employment rose only marginally, the slowest pace of 2026, and services jobs were flat after nine months of gains.

Cooler prices come as the Reserve Bank of India's defense of the rupee has shrunk the banking system's cash surplus.

What Comes Next for India's Data Calendar

The core sector figures carry heavy weight in the Index of Industrial Production, which covers a wider set of mining, manufacturing and power output. A strong core reading usually points to a firmer industrial production print for the same month.

On the fiscal side, the government's fiscal deficit reached 42.1% of the full-year target in the first half of the fiscal year, with a fuel tax cut weighing on revenue.

S&P Global's final October manufacturing PMI, which revises the flash estimate, is due in early November. The ministry will publish the core sector index for October on Nov. 20.