IIP Current Affairs - 2019

Category Wise PDF Compilations available at This Link

Growth of eight core sectors slows to 2.1% in July 2019

According to official data released by Government, Growth of eight core industries (Index of Eight Core Industries) dropped to 2.1% in July 2019. It was mainly due to contraction in coal, crude oil, natural gas and refinery products. These eight sectors had expanded by 7.3% in July 2018. Moreover, it has declined by 6.2% during April to July, 2019-20 over the corresponding period of previous year.

Sector wise breakaway (July 2019)

Index of Eight Core Industries

It is monthly production index, which is also considered as lead indicator of the monthly industrial performance. It contains production and growth figures of eight core industries viz. steel, electricity, crude oil, refinery products, coal, cement, natural gas and fertilizers. It is compiled by Central Statistic Organisation (CSO) under Union Ministry of Commerce and Industry based on monthly production information received from source agencies. These core industries are considered as main or key industries of the economy and serve as backbone of all other industries

Weightage: Petroleum Refinery production (weight: 28.04%), Electricity generation (19.85%), Steel production (17.92%), Coal production (10.33%), Crude Oil production (8.98%), Natural Gas production (6.88%), Cement production (5.37%), Fertilizers production (2.63%

Relation with index of industrial production (IIP):  These eight core sectors constitute 40.27% of IIP.

Economic Slowdown

The data concerned with slowdown in growth of eight core sector comes days after India’s GDP growth rate slowed to 6-year low of 5% for first quarter of FY 2019-20. It was down from 5.8% in fourth quarter of FY 2018-19. In first quarter of the previous financial year, GDP growth was 8.2%. This effectively means that India’s growth rate has fallen by 3% in barely a year’s time. This is fourth successive decline in GDP, from 8% in 1st quarter of FY19 to 5% in this quarter. It is also the slowest growth since Q1 in 2013.

Industrial production growth slows to 1.7% in January 2019

The Central Statistics Office (CSO) has released the data for the Index of Industrial Production (IIP) for the month of January. The IIP data shows that:

  • Industrial output growth stood at 1.7 per cent in January against the 2.6% growth recorded in December 2018.
  • The CSO has revised the industrial production growth for December 2018 has been revised upwards from 2.4% to 2.6%.
  • The growth of output of manufacturing sector moderated to 1.3% and the electricity generation rose a mere 0.8% in January 2019.
  • The mining output rebounded 3.9% in January 2019, snapping 1% decline in December 2018.
  • Capital goods output declined 3.2% in January 2019 and the output of intermediate goods also fell by 3.0% in January 2019.
  • The output of primary goods increased by 1.4%, while that of infrastructure/ construction goods moved up 7.9% in January 2019 when compared to January 2018.
  • The output of consumer durables moved up 1.8%, while that of consumer non-durable durables also rose 3.8% in January 2019 when compared to January 2018.
  • Eleven out of the twenty-three industry groups in the manufacturing sector have shown positive growth during the month of January 2019 as compared to January 2018.
  • The cumulative industrial production increased by 4% in April-January FY2019 compared with 4.1% growth in April-January FY2018.
  • The manufacturing sector growth has improved to 4.4% in April-January FY2019 from 4.2% growth in the corresponding period last year.
  • The electricity generation output growth also improved to 5.8%, while mining output growth accelerated to 5.3% in April-January FY2019.

Index of Industrial Production

Index of Industrial Production (IIP) is a composite indicator that measures the changes in the volume of production of a basket of industrial products during a given period with respect to the volume of production in a chosen base period. The base year for the IIP is 2011-12.