CORE SECTORS INDUSTRIES
Focus: GS III-Indian Economy
Why in News?
The output of Eight Core Industries grew at 3.1 %, the slowest pace in eight months in November, indicating slowing momentum in the Indian economy. Barring crude oil and cement, all other sectors recorded positive growth.
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).
- The eight core sector industries in decreasing order of their weightage: Refinery Products> Electricity> Steel> Coal> Crude Oil> Natural Gas> Cement> Fertilizers.
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 Central Statistical Organization (CSO), Ministry of Statistics and Programme Implementation (MOSPI).
- The Central Statistics Office (CSO) revised the base year of the all-India Index of Industrial Production (IIP) from 2004-05 to 2011-12 on 12 May 2017.
- 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.
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.