IIP records slowdown in May 2019Date: 13 July 2019 Tags: Basics of Economics
According to data released by Central Statistics Office (CSO), factory output measured in terms of Index of Industrial Production (IIP) slowed to 3.1% in May 2019, weighed down by muted growth in mining and manufacturing sectors. It had expanded by 3.8% in May 2018. It had rose to 4.3% in April 2019 after a sharp decline of 0.4% in March 2019.
Breakaway of May 2019 IIP
- Mining and quarrying sector: It was one of only major sectors that saw growth accelerating, from contraction of 0.39% in December 2018 to growth of 3.9% in January. 2019.
- Manufacturing sector: It eased to 2.5%.
- Electricity sector: It saw growth slowing to 0.8% from 4.45% over the same period
- Capital goods sector: It slowed to 0.8% against 2.5% growth in April 2019.
- Primary goods: It slowed to 2.5% in May against 5.2%in April 2019.
- Consumer sector: Production of consumer durables contracted 0.1% in May 2019 against healthy 2.4% growth in April 2019. Production of consumer non-durables grew to 7.7% in the same period against a 5.2% growth in April 2019.
About Index of Industrial Production (IIP)
- It is composite indicator that measures short-term changes in volume of production of basket of industrial products during given period with respect to chosen base period.
- It is released on monthly basis by Central Statistical Organization (CSO), Ministry of Statistics and Programme Implementation (MoSPI). Base year is 2011-12.
- It comprises 407 individual items and sector wise, these items fall into three categories-Manufacturing (405 items), Mining (1 items) & Electricity (1 item).
- The separate weightages of the three sectors are 77.63%, 14.37%, 7.9% respectively. In IIP, combined weightages of eight core Industries is 40.27%.
- In use wise composition, these 407 individual items are divided into capital goods, basic goods, intermediate goods and consumer goods.
- Further, consumer goods are divided into consumer durables and consumer non-durables. In it, maximum weight is of basic goods, followed by Consumer Goods, followed by Intermediate and Capital Goods.