Core Sector Output
June 3, 2022 at 11:44:21 AM
Why in News?
India's eight core sector industries showed a robust growth of 8.4% in April compared to 4.9% in March 2022.
The eight core sector 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 are: Refinery Products> Electricity> Steel> Coal> Crude Oil> Natural Gas> Cement> Fertilizers.
What is the Index of Eight Core Industries?
Index of Eight Core Industries (ICI) refers to the production volume index.
It evaluates the combined as well as individual performance of production in selected eight core industries.
The current weightage (April 2021), of eight core industries is given below:
Petroleum Refinery production (28.04%), Electricity (19.85%), Steel (17.92%), Coal production (10.33%), Crude Oil (8.98%), Natural Gas production (6.88%), Cement production (5.37%), Fertilizer production (2.63%).
ICI is compiled and released by the Office of Economic Adviser (OEA), Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce and Industry.
ICI provides advance indication on production performance of industries of ‘core’ nature prior to the IIP release by the National Statistical Office, NSO.
General economic activities and industrial activities are likely to get impacted by the eight core industries.
What is the Index of Industrial Production?
Index of Industrial Production (IIP) is an indicator that measures the changes in the volume of production of industrial products during a given period.
It is compiled and published monthly by the National Statistical Office (NSO), Ministry of Statistics and Programme Implementation.
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.
Base Year for IIP is 2011-2012.
Significance of IIP:
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 Gross Domestic Product (GDP) estimates.
IIP, India's eight core sector industries