Revamped Index of Industrial Production (IIP)

India is set to release an updated Index of Industrial Production (IIP) on June 1, with significant changes to its structure and coverage.

Key Updates

• Base Year Update: The base year will be updated to 2022-23.
• Expanded Coverage: New sectors such as minor minerals, rare earth minerals, gas supply, water supply and sewerage, and waste management will be included.
• Granular Tracking: The new series will feature separate indices for renewable and non-renewable electricity generation.

Technical Advisory Committee (TAC) Recommendations

• The index will cover 1,042 products across 463 item groups.
• Alignment with the National Industrial Classification (NIC-2025) framework.
• Restructuring of the manufacturing basket with 120 new item groups added and 64 removed.
• Existing six use-based classification categories will be retained.

Sub-Indices Introductions

• Separate indices for electricity from renewable and non-renewable sources.
• Mining and quarrying sector split into three sub-indices: fuel minerals, metallic minerals (including rare earth minerals), and non-metallic minerals (including minor minerals).

Methodological Changes

• Use of tap connections to track water supply.
• Sewerage tracked through connections in 500 AMRUT cities.
• Urban waste collected and processed metrics for waste management.
• Adoption of the geometric mean method to link the 2011-12 series with the 2022-23 series.
• Introduction of a chain-linked IIP, allowing periodic updates of weights.

Additional Proposals

• Publishing IIP data for all 36 states and union territories.
• Development of a separate industrial index for the unincorporated sector.
• Releasing seasonally adjusted IIP data.
• Retention of 'not elsewhere classified (nec)' items within manufacturing.