Power demand in industrial states signals cooling output

India's GDP growth rate for January-March quarter came in at 7.4%, backed by agriculture and construction

- 

Trialized states is seen as a proxy for overall industrial power consumption. Since industries account for roughly 45% of total power demand, weakness in these states could indicate a broader slowdown in industry.

"The major reason for the reduction in the industrial power demand has been the slowdown in economic activity, particularly in mining and manufacturing sectors, where the industrial output has remained weak in the months of March and April 2025," Mohammad Saif, partner, strategy and transactions at EY India, said.

Saif noted that while manufacturing growth fell to 3.4% in April 2025 from 3.9% in April 2024, mining, another power guzzler, shrank 20 basis points compared to a growth of 6.8% in April 2024. India's overall power demand in May (25 days) fell 4% y-o-y to 148.71 BUs, and grew just 2.2% in April, compared to a 7% growth in March.

To be sure, this year's summer has been less harsh than in the previous years, and early rains have dampened power demand across much of the country.