IIP boosts by 6.8%

Helped by a robust show by the manufacturing sector, especially consumer goods, India’s industrial output in January expanded at a fast paced 6.8 per cent when compared to the sluggish rate in the past few months, official data released on Monday showed. Showing signs of recovery, industrial production gathered pace and grew 6.8 per cent in January, over the previous month, mainly due to improvement in the manufacturing sector. Output of the manufacturing sector, which constitutes over 75 per cent of the index, rose 8.5 per cent in January, compared to 8.1 per cent in the same month last year, according to the official data released on Monday. In the last month, IIP grew at a snail’s pace at 1.8 per cent, depicting the slowdown in the economy and putting pressure on policymakers to take steps to stem the fall.

So what is this IIP anyway? Well, it’s the Index of Industrial Production (IIP) in simplest terms is an index which details out the growth of various sectors in an economy. E.g. Indian IIP will focus on sectors like mining, electricity, Manufacturing & General. Also base year needs to be decided on the basis of which all the index figures would be arrived at. In case of India the base year has been fixed at 1993-94 hence the same would be equivalent to 100 Points but now it changed its based year to 2004-2005.

HIGHLIGHTS:

The Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month of January 2012 stand at 137.2, 202.4 and 151.1 respectively, with the corresponding growth rates of (-) 2.7%, 8.5% and 3.2% as compared to January 2011 (Statement I). The cumulative growth in the three sectors during April-January, 2011-12 over the corresponding period of 2010-11 has been (-)2.6%, 4.4% and 8.8% respectively, which moved the overall growth in the General Index to 4.0%. The industry group ‘Food Products and Beverages’ has shown the highest growth of 92.6%, followed by 56.1% in ‘Publishing, Printing and Reproduction of Recorded Media’ and 29.9% in ‘Medical, precision & optical instruments, watches and clocks’.