India's core infrastructure sector faced a 0.4% contraction in March 2026, the lowest level in nearly two years, reversing the previous month's growth of 2.8%. This downturn is largely attributed to the ongoing conflict in West Asia, which disrupted supply chains and significantly impacted energy-related industries. Notably, crude oil production fell by 5.7%, coal output declined by 4%, and electricity generation dipped by 0.5%. The fertiliser sector was hit hardest, experiencing a staggering 24.6% decrease year-on-year. However, not all sectors fared poorly; steel production increased by 2.2% and cement production rose by 4% in March. Despite the monthly contraction, the cumulative performance for the fiscal year 2025-26 showed a modest growth of 2.6%. Aditi Nayar, chief economist at Icra Ltd, noted that the mixed performance indicates resilience in some sectors, although overall growth remains uneven. She anticipates that the Index of Industrial Production (IIP) growth will slow to between 1.0% and 2.0% in March 2026, down from 5.2% in February.