PIB Summary- 1st February, 2023 | Current Affairs & Hindu Analysis: Daily, Weekly & Monthly - UPSC PDF Download

Core sector growth

Context
India’s 8 core sectors’ output growth hit a 3-month high of 7.4% in December, from a revised uptick of 5.7% in November, with all sectors save crude oil reporting a rise.

Relevance: GS-III: Indian Economy (Growth and Development of Indian Economy, Inflation)

Dimensions of the Article

• What is Index of Industrial Production (IIP)?
• About Index of Eight Core Industries:
• Significance of IIP

What is Index of Industrial Production (IIP)?

• The Index of Industrial Production (IIP) is an index that shows the growth rates in different industry groups of the economy in a fixed period of time.
• It is compiled and published MONTHLY by the National Statistical Office (NSO), Ministry of Statistics and Programme Implementation.
• Base Year for IIP is 2011-2012.
• IIP is a composite indicator that measures the growth rate of industry groups classified under:
• Broad sectors, namely, Mining, Manufacturing, and Electricity.
• Use-based sectors, namely Basic Goods, Capital Goods, and Intermediate Goods

About Index of Eight Core Industries

• The Eight Core Industries comprise 40.27% of the weight of items included in the Index of Industrial Production (IIP).

Released by: The Office of the Economic Adviser, Department for Promotion of Industry and Internal Trade
Base year: 2011-12
Below image attached Eight Core Industries based on their weightage.

Significance of IIP

• IIP is the only measure on the physical volume of production.
• It is used by government agencies including the Ministry of Finance, the Reserve Bank of India, etc., for policy-making purposes.
• IIP remains extremely relevant for the calculation of the quarterly and advance GDP estimates.