Home Simple Economics What are IIP numbers? Know more about IIP numbers

What are IIP numbers? Know more about IIP numbers

IIP numbers

Index of Industrial Production (IIP) – Indicator for India Inc’s growth

IIP number or IIP data (Index of Industrial Production) is a measurement which represents the status of production in the industrial sector for a given period of time compared to a reference period of time. IIp number is one of the best statistical data, which helps us to measure the level of industrial activity in Indian economy. Please note that IIP data is a short-term indicator of our industrial growth till the actual results from Annual Survey of Industries (ASI) is published. IIP data is a very important indicator to the Government for planning purposes and is also used by various organisations like Industrial Associations, Research Institutes, Financial Institues and Academicians.

How IIP Data is formed?

IIP data is a simple index which provides information about the growth of different sectors of our economy like mining, electricity, Manufacturing & General. The IIP index reflects the growth in India’s industrial activity and excludes all kinds of services. The base year for the index over the period of the analysis is 1993-94.

Use-Based Classification

Another classification is use-based (consumption based), where IIP is classified on the base of use like Basic Goods, Capital goods, Intermediate goods & consumer goods.

Sectors in IIP Data (IIP numbers)

The weightage of Indian IIP data is broadly divided into three segments – manufacturing (79.36%), mining & quarrying (10.47%) and electricity (10.17%)…

Manufacturing : includes items like food items, machinery, wood furniture etc

Electricity : includes generation and transmission of electricity ( from various sources like – thermal, hydro, solar etc)

Mining : includes mining of coal, oil other metals etc

Manufacturing is the major sector, which is further divided into 17 industry groups like

  • Food Products
  • Beverages,Tobacco and related Products
  • Cotton Textiles
  • Wool, silk and man made fibre textiles
  • Jute and other vegetable fibre textiles
  • Textile products including wearing apparel
  • Wood and wood products (furniture & fixtures)
  • Paper, paper products, printing and allied industries
  • Leather and leather and fur products
  • Basic Chemicals & Chemical Products (except products of Petroleum & Coal)
  • Rubber, Plastic, Petroleum and Coal Products
  • Non-Metallic Mineral Products
  • Basic Metal and Alloy Industries
  • Metal Products and Parts, except Machinery and Equipment
  • Machinery and Equipment other than Transport equipment
  • Transport Equipment and Parts
  • Other Manufacturing Industries
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  1. IIP numbers are very useful from the point of view of investors. IIP numbers help to give an insight of all the industries in India. IIP numbers also give an idea about the overall economic growth of India to the general public as well as investors and traders. On the basis of this data, one can easily make out the fastest growing industry and design his portfolio accordingly. However, it should be noted that this data is useful only in the short-run and investments should be made accordingly.

  2. IIP number details out the growth of various sectors in an economy such as mining, electricity and manufacturing. It is a composite indicator that measures the short term changes that happen in a particular sector during a time period. Basically the Index of Industrial Production is an abstract number and the basic objective is to understand the trends in production.

  3. Index of industrial production or the iip data is to know the level of growth for only a given period of time and is calculated by a base year.Is the base year still 93-94? This data is helpul in planning reforms and policies only for a short period of time. For a final or full picture it is better to refer to ASI reports.

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