New Delhi, July 5 -- Industrial credit could emerge as the next growth driver for the Indian banking sector as government measures to boost manufacturing gather pace after a decade of modest performance, according to a recent research report by Anand Rathi.

The banking sector thematic report highlighted that industrial lending has strengthened after a prolonged period of slow growth and is showing renewed momentum.

Industrial credit, which constitutes approximately 21 per cent of total bank credit, has seen its year-on-year growth accelerate sharply from around 7 per cent in April 2025 to nearly 15 per cent in April 2026.

"The segment was a key driver of banking credit over FY04-14, compounding at rate of more than 20 per cent CAGR. Ho...