Core sector output contracts 0.4% in March as coal, crude oil, and fertilisers weigh

India’s eight core industries output contracted 0.4% year-on-year in March 2026 on a provisional basis, dragged down by weak production in fertilisers, crude oil, coal, and electricity. 

The Index of Eight Core Industries (ICI), which tracks the performance of coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity, accounts for 40.27% of the Index of Industrial Production (IIP), making it a key indicator of industrial momentum. 

The March contraction comes after the core sector had expanded 2.8% in February 2026. For the full financial year FY26, covering April 2025 to March 2026, the cumulative growth of the eight core industries stood at 2.6% on a provisional basis. 

Coal production declined 4.0% 

Coal production declined 4.0% in March from a year earlier while crude oil output fell 5.7%. Fertiliser production recorded the sharpest fall, plunging 24.6% during the month. Electricity generation also slipped 0.5% compared with March 2025. 

Sectors that posted growth 

Among sectors that posted growth, natural gas production rose 64% year-on-year, cement output increased 4.0%, and steel production grew 2.2%. Petroleum refinery products registered marginal growth of 0.1%. 

For the full year, steel and cement emerged as the strongest-performing core sectors. Steel production rose 9.1% during FY26, while cement output grew 8.6%. Electricity generation increased 0.9% over the year. 

However, several sectors remained under pressure on a cumulative basis. Coal production declined 0.5%, crude oil output fell 2.8%, and natural gas production also dropped 2.8%. Refinery products and fertilisers each declined 0.1% during the year. 

The March contraction signals a mixed trend in industrial activity, with infrastructure-linked sectors such as steel and cement showing resilience, while energy and commodity-linked sectors continued to face pressure. The data may also have implications for broader industrial production numbers in the final month of FY26. Release of the index for the month of April will be on May 20 (Wednesday).