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PIB Summaries 01 February 2023

CONTENT

  1. Core sector growth

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:

  1. What is Index of Industrial Production (IIP)?
  2. About Index of Eight Core Industries:
  3. 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.

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