Scorched Reality

A searing heat-wave has descended upon Europe with a vengeance – and well before its usual time.

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India's industrial growth, long considered a key gauge of the country's economic vitality, has begun to show signs of a worrying deceleration. The data for May 2025, registering a meagre 1.2 per cent year-on-year growth in the Index of Industrial Production (IIP), marks the slowest pace in nine months. More than a statistical blip, this reading signals the onset of deeper structural and seasonal pressures that may weigh on the economy's broader trajectory through the year. At first glance, the headline number masks a mix of diverging trends within the industrial ecosystem. Manufacturing, the core of industrial output, expanded by just 2.6 per cent, continuing its descent from 3.1 per cent in April. More concerning is the simultaneous contraction in both electricity generation and mining – two foundational sectors that are typically more resilient to cyclical swings. The early arrival of the monsoon this year has evidently dampened energy demand while disrupting extraction activities, underscoring how vulnerable India's infrastructure remains to seasonal volatility. Yet, it's the demand-side indicators that warrant the closest scrutiny. Output of consumer durables – a category that includes household electronics, automobiles, and appliances – shrank by 0.7 per cent, a stark reversal from the robust 6.2 per cent growth recorded in April. Consumer non-durables, encompassing essentials like packaged food and toiletries, fared no better, falling 2.4 per cent. These declines suggest not only weakening demand from households but also the possibility of inventory overhangs and tightening liquidity across urban and rural markets. Curiously, capital goods emerged as a bright spot, surging 14.1 per cent in May and sustaining the strong pace set in April. This indicates that investment activity – either private sector-led o