RAS question
Which sector of India's IIP showed the highest growth rate of 12.5% in February 2026, the best performance in 9 months?
Correct answer: (B) Capital Goods.
Capital goods recorded the highest IIP growth in February 2026, with output rising 12.5%.
Explanation
India's February 2026 IIP data show capital goods output growing 12.5%, ahead of mining, electricity, and consumer durables. Capital goods is therefore the answer because the comparison turns on the sector with the highest growth rate, not the largest weight or index level. Economically, capital goods growth is commonly read as a proxy for private investment sentiment, since it reflects production of machinery and equipment-type goods used for future capacity. By comparison, the PIB release reports mining growth at 3.1% and electricity at 2.3%, both far below capital goods. Consumer durables also did not match the 12.5% figure, so it cannot be the best-performing sector in this set.
Why the other options are wrong
- (A) Mining grew 3.1% in February 2026, well below the 12.5% growth reported for capital goods.
- (C) Electricity grew 2.3%, so it was not the sector showing the highest growth among the options.
- (D) Consumer durables did not record the 12.5% growth figure; the 12.5% figure belongs to capital goods in the use-based IIP data.
Concept
The Index of Industrial Production includes a use-based classification, and capital goods are watched as an investment-sentiment signal. RAS often asks such questions because current macro indicators link factual data with economic interpretation.