IIP, GST, Fiscal Deficit and Auto Sales: Key Data to Watch This Week

A series of high-frequency data releases this week will give a closer read on the strength and composition of India's economic activity, spanning factory output, tax collections, government finances, vehicle demand and external liabilities.

Industrial output

The August index of industrial production is due on 28 September. Industrial growth has been firm so far in FY27, averaging 7.7% in June and July, after 2.9% in April and 1.5% in May. Manufacturing led the acceleration, expanding 9.5% in June and 7.3% in July, though the breadth of high growth narrowed: of the 23 manufacturing sectors, 12 grew more than 10% in June, against eight in July.

Motor vehicles, transport equipment and electrical equipment were among the stronger performers in July, while tobacco and pharmaceuticals contracted. The August reading follows a moderation in the eight core industries, which make up about 40% of the IIP basket, to 4.8% from 5% in July, with coal, natural gas, crude oil and fertilizers contracting. The data will show whether that weakness has spilled over into the wider industrial sector.

GST collections

GST collections for September transactions will be released this week, with import-linked revenue expected to remain a key driver. Gross collections rose 14.8% year-on-year to ₹1.99 trillion in August, but the increase was led by import-linked revenue, which climbed 29% against 9.3% growth in domestic revenue.

Import-linked collections contributed roughly 55% of the ₹25,737 crore year-on-year increase in gross GST, despite accounting for only 31% of the total. The import component was buoyed by a 14.1% rise in merchandise imports, with the value of crude oil imports up 25.8% year-on-year on higher prices despite lower volumes. Refunds, however, trimmed what the government retained: net GST collections rose 67.9% to ₹31,795 crore in August, slowing growth to 8.3% from 15.8% in July. Net domestic revenue grew just 3.4%, while net import revenue rose 22.3%.

Fiscal position

August fiscal deficit data is scheduled for 30 September. In the first four months of FY27, the deficit stood at ₹4.55 trillion, or 26.8% of the full-year target, compared with 29.9% a year earlier. Net tax revenue rose 27.6% to ₹8.45 trillion, while capital expenditure increased 29.9% to ₹4.51 trillion.

The numbers arrive as the government finalises its October-March borrowing calendar. It had raised ₹7.79 trillion of the ₹16.09 trillion FY27 gross borrowing programme by mid-September, leaving ₹7.96 trillion for the second half. The key question is whether tax collections hold pace as spending picks up, a calculation that also depends on oil and fertilizer costs, which chief economic adviser Anantha Nageswaran recently described as uncertainties for fiscal management. A deficit running below last year's pace would give the government more room to sustain capex while staying on course for its 4.3%-of-GDP target.

Festive demand

Major automakers including Maruti, Tata Motors and Mahindra & Mahindra will report September sales on 1 October, providing an early signal on demand ahead of the festive season. Sales have recovered sharply in FY27 after a weak run last year. Monthly average sales from April to August declined in 2025 before rebounding strongly in 2026.

August was especially weak in FY26, as buyers held back ahead of anticipated GST rate changes that took effect in September; Tata Motors, Mahindra & Mahindra, Maruti, Hyundai and Bajaj Auto all posted year-on-year declines that month. The comparison this August was markedly different, with Tata Motors up 59.2%, Mahindra & Mahindra up 40.4% and Maruti up 34.3%. With festive sales typically strengthening in October and November, September is an important lead-in month, and the August performance sets a higher base for the latest numbers.

External debt

External debt data for the June quarter, due on 30 September, will offer a fresh read on India's external funding needs at a time of strong foreign-currency inflows. The focus is likely to be on composition, particularly short-term liabilities, rather than the debt-to-GDP ratio, which has been broadly stable. As of the March 2026 quarter, loans formed the largest share of external debt at 34.8%, followed by currency and deposits at 22.4%, trade credit and advances at 19%, and debt securities at 16.1%, with special drawing rights and direct investment making up smaller portions.

The data will also capture a period of unusually strong foreign-currency mobilisation by Indian banks, which attracted $136.4 billion through the RBI's special swap facility by end-August, including $127.2 billion through FCNR(B) deposits. Those inflows have strengthened external buffers while adding to banks' foreign-currency liabilities. The release will show whether the rise in external liabilities has altered the maturity profile, and whether a further build-up in short-term debt warrants closer attention even if the headline ratio stays stable.