Index of Industrial Production
INDEX OF INDUSTRIAL PRODUCTION
What’s in news?
- Index of Industrial Production (IIP) stands at 127.7 for October 2019, which is 3.8% lower as compared to the level in the month of October 2018.
- According to the data released by the Ministry of Statistics and Programme Implementation (MoSPI), the quick estimates of Index of Industrial Production (IIP) stands at 127.7 for October 2019, which is 3.8% lower as compared to the level in the month of October 2018.
- This contraction is due to demand slump in economy and fall in activity across sectors such as manufacturing, electricity, infrastructure etc.
- Retail inflation (measured by the Consumer Price Index) surged to a 40-month high of 5.54% in November 2019, owing to rising food inflation.
- The combination of contraction in industrial activity and rising inflation has led experts to fear that India is entering a phase of stagflation. Inflation refers to the rise in the prices of most goods and services of daily or common use, such as food, clothing, housing, recreation, transport, consumer staples, etc
- Stagflation means a situation characterized by simultaneous increase in prices and stagnation of economic growth. It is described as a situation in the economy where the growth rate slows down, the level of unemployment remains steadily high and yet the inflation or price level remains high at the same time.
- The Index of Industrial Production (IIP) is an index which shows the growth rates in different industry groups of the economy in a stipulated period of time.
- It is estimated and published on a monthly basis by the Central Statistical Organisation (CSO) under MoSPI.
- It is currently calculated using 2011-2012 as the base year.
- Eight core industries that comprise about 40% of the weight of items included in the Index of Industrial Production are;
- Crude oil,
- Refinery products,
- Natural gas, and
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