infrastructure sector
There have been encouraging signs from India’s infrastructure sector in December 2025. According to government data, the country’s infrastructure output grew by 3.7% on an annual basis, which is the fastest growth in the last four months. The main reason behind this growth is considered to be the strength in cement, steel and electricity production.
The Infrastructure Index reflects the activities of eight major sectors of the country namely coal, crude oil, natural gas, refinery products, fertilizers, steel, cement and electricity. This index constitutes about 40% of the total industrial production (IIP) of the country, hence the change in it is considered an important indicator of the health of the economy.
Effect of boom in real estate sector
Cement production increased by 13.5% in December, which shows that activities in the construction and real estate sectors have been brisk. Steel production recorded an increase of 6.9%, while electricity production increased by 5.3%. These three sectors are considered strong pillars of infrastructure growth and the impact of government’s Capex (capital expenditure) is also being linked to their better performance.
However, good news did not come from all sectors. Crude oil production declined by 5.6% in December, natural gas production declined by 4.4% and the output of refinery products also declined by 1%. This indicates that challenges remain in the energy sector, which may impact the broader economy in the coming months.
Country’s economic growth strengthened
Talking about the period from April to December, the total infrastructure output has increased by 2.6%, whereas in the same period last year this growth was 4.5%. That is, the pace is a little slow on an annual basis, but the figures for December show that there has been an improvement in economic activities at the end of the year. Experts believe that if the government’s spending on infrastructure continues like this and private investment also increases, then the infrastructure sector can further strengthen the country’s economic growth in the coming months.