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Union Government revises Base Year of IIP to 2011-2012 from 2004-05

May 15, 2017 13:06 IST

The Central Statistics Office (CSO), under Ministry of Statistics and Programme Implementation, on 12 May 2017 revised  the base year of the all-India Index of Industrial Production (IIP) from 2004-05 to 2011-12.

The new base year was selected keeping in view the base year of other macroeconomic indicators namely Gross Domestic Product (GDP) and Consumer Price Index (CPI).

Sectoral Composition of IIP

Sector

Base year 2011-12

Base year 2004-05

Weights (%)

Item groups

Weights (%)

Item groups

Mining

14.373

1

14.157

1

Manufacturing

77.633

405

75.527

397

Electricity

7.994

1

10.316

1

Total

100

407

100

399

Highlights of the new series of Index of Industrial Production (IIP) with base year 2011-12
• IIP in the new series will continue to consist of three sectors viz. Mining, Manufacturing and Electricity, as in the existing series.
• The National Industrial Classification 2008 will be followed in the new series for the purpose of classification of products as per industries.
• The unit coverage of IIP will, as before, cover entities in the organized sector units registered under the Factories Act, 1948.
• The Use-Based Classification was revised to reflect the industrial segments and production more accurately as well as to map the products more accurately as per their use in the industries.
• The new use based classification includes Primary Goods, Intermediate Goods, Infrastruture/Construction Goods, Capital Goods, Consumer Durable Goods and Consumer Non Durable Goods
• The coverage of the new series of IIP is limited to the Organized Sector only.
• For enabling dynamic revision of the methodology of IIP including the item list and the panel of factories during the currency of a base year, a Technical Review Committee, chaired by Secretary of Ministry of Statistics, will be constituted.
• The new series show higher growth rates in most months in the period April 2012 to March 2017 which is attributable to (i) shifting of base to a more recent period (ii) increase in number of factories in panel for reporting data and (iii) inclusion of new items and exclusion of old ones.

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Changes in the New IIP series (base 2011-12) while comparing with the old series
• The growth rates of the two series are not strictly comparable as the indices for 2011-12 have been normalized to 100 at a monthly level.
• Increase in number of factories in panel for reporting data and closed ones have been removed.
• The item basket has been revised with inclusion of new items and exclusion of old ones.
• The electricity sector now includes data from renewable energy sources.
• The coverage of the mining sector has undergone a change.

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Read more Current Affairs on: Index of Industrial Production , IIP , revision of Base Year , 2011-12

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