Index of Industrial Production (IIP)

In News 

• India’s industrial recovery slowed sharply in December, with output growing just 0.4% year-on-year, and manufacturing activity shrinking 0.1% in the month, as per quick official estimates for the Index of Industrial Production (IIP)

About  Index of Industrial Production (IIP)

• It 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.
• In India, the first official attempt to compute the Index of Industrial Production (IIP) was made much earlier than the first recommendation on the subject came at the international level. 
• With the inception of the Central Statistical Organization (now known as the National Statistics Office (NSO)) in 1951, the responsibility for compilation and publication of IIP was vested with it.
• Ministry: Ministry of Statistics and Programme Implementation.
• Base year: 2011-2012
• Sources of data: NSO compiles the Index of Industrial Production (IIP) using secondary data received from 14 source agencies in various Ministries/Departments or their attached/subordinate offices.
• The Department of Industrial Policy and Promotion (DIPP) is the source for the major chunk of data for the calculation.

About Eight Core Sectors

• These 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.

Source: IE