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Industrial output expands 7% in June
Why in the news ?
- According to data released by the Central Statistics Office (CSO, Industrial output recorded a growth of 7 per cent in June on account of higher output in mining, manufacturing, power generation segments and a low base growth.
- Industrial output, measured by Index of Industrial Production (IIP), contracted by 0.3 per cent in June 2017.
Details
- The manufacturing sector, which constitutes 77.63 per cent of the index, grew by 6.9 per cent in June, against 0.7 per cent decline in the year-ago month.
- Analysts said the growth rate is higher than expectations but it does not indicate a broad-based recovery.
- Power generation segment grew 8.5 per cent in June against 2.1 per cent growth a year ago.
- The mining sector output recorded 6.6 per cent in June against 0.1 per cent in June 2017.
- The stimulus by the government on the current and capital sides and a pickup in private investment has led to industrial growth.
- This is shown by a pickup in other indicators as well, such as credit data and exports.
Index of Industrial Production (IIP)
- The Index of Industrial Production (IIP) is the number denoting the condition of industrial production during a certain period.
- IIP shows the status of industrial activity, you can find out if the industrial activity has increased, decreased or remained same.
- It is important for the IIP to reflect true industrial trends, which in turn has an impact on the policy decision-making.
- These figures are calculated in reference to the base year. Currently the base year is 2011-12.
- Index of Industrial Production (IIP) is released by the Central Statistics Office (CSO) of the Ministry of Statistics and Programme Implementation.
- It dose not consider measuring of informal sector activity . Same with the PMI
Source
The Hindu, Indian Express.