With the country in the grip of a heatwave in May, India’s electricity generation hit a record high and the production of consumer durables such as air-conditioners and refrigerators jumped 12.3% to touch the second-highest level in at least 14 months, pushing industrial output growth to a seven-month high of 5.9% in May.

These two segments bolstered the recovery from a three-month low growth of 5% in the Index of Industrial Production (IIP) recorded in April, even as manufacturing growth remained underwhelming at 4.6%, and half the use-based segments witnessed a growth deceleration from April.

Electricity generation jumped 13.7% in May compared with a 10.2% uptick a month earlier, and was 8.2% over the output recorded this April. Consumer durables were up 12.3%, compared with a 10% rise in April. Consumer non-durables’ production recorded a minor 2.3% growth in May, compared with a 2.5% contraction in April. Their total output in the first two months of 2024-25 remains 0.1% below the same period last year. Within manufacturing, which constitutes 77.6% of the IIP, six of 23 sectors reported contractions, the same number as April. Food products (-5.5%), textiles (-0.7%), chemicals (-0.5%), rubber and plastic (-0.9%), and other manufacturing (-8.6%), were among the sectors that recorded a downturn. On the other hand, five sectors clocked over 10% growth in May, including furniture (23.2%), computers and electronics (20.1%), other transport equipment (16.8%), and electrical equipment (14.7%). Growth in primary goods production accelerated to 7.3% from 7% in April. Capital goods output grew 2.5% in May, slowing from 2.7% in April, but production levels were 10.8% higher on a month-on-month basis. Intermediate goods grew 2.5%, moderating from 3.2% in April, while infrastructure and construction goods growth eased marginally from 8% in April to 6.9% in May. Coal output rose 6.6% year-on-year, a tad slower than April’s uptick, although production levels were 4.3% over April. “Sharply higher power demand reflects more severe summer heat conditions across India which has led to steadily rising usage of household air-conditioners as well as higher usage of water pumps,” said Suman Chowdhury, chief economist and head of research at Acuité Ratings & Research. Aditi Nayar, chief economist at ICRA said that IIP growth will likely ease to a range of 4% to 5% in June based on trends in the available high frequency data.