Index of Eight Core Industries


Ajit Kumar AJIT KUMARWISDOM IAS, New Delhi.


The Index of Eight Core Industries is a monthly production index, which is also considered as a lead indicator of the monthly industrial performance. The Index of Eight Core Industries is compiled based on the monthly production information received from the Source Agencies. The Index of Eight Core Industries is released on the last working day of every month (or next working day, if the last day of a month is holiday). The index is released by means of a Press Note prepared by the Office of the Economic Adviser, DIPP, Ministry of Commerce and Industry.


The Central Statistics Office (CSO) of the Government of India brings out monthl Index of Industrial Production (IIP). Industrial Production in the IIP comprises three distinct groups of industry, (a) Mining, (b) Manufacturing and (c) Electricity. The quick estimate of IIP pertaining to a month is released after approximately six weeks (on 12th of the Month, or if 12th is a Gazetted Holiday, on the previous working day).
Among the industries that go into the IIP basket, in order to provide an indication of how the industries whose production performance was ‘core’ in nature because of their likely impact on general economic activity as well as other industrial activity, the exercise of bringing out an Index of Core Industries was initiated in the Office of the Economic Adviser, with six industries, viz. Coal, Cement, Electricity, Crude Oil, Refinery products, and Steel. The Index of Six Core industries had a combined weight of 26.7 per cent in the earlier series of the IIP with base year 1993-94.
When the base year for IIP was revised to 2004-05, the base year for the Index of Core Industries was also revised to 2004-05, along with a revised weighting diagram. In the new series, two new additions, i. e. of Natural Gas and Fertilizers weremade to make it an Index of Eight Core Industries accounting for 37.9 percent weight in the Index of Industrial Production (IIP). This Index is available since 2007-08 .
The Eight Core Industries are Coal, Cement, Electricity, Crude Oil, Refineryproducts, Steel, Fertilizers and Natural Gas, which have the following weights in IIP.
The Index of Eight Core Industries is released on the last day of the month following the month for which the Index pertain. If the last day of the month is a Gazetted Holiday, then it is released on the next working day. The Index of Eight Core Industries released about two weeks prior to the IIP release provides an advance indication of performance of more than one third of the IIP basket.


Index of Eight Core Industries (Base: 2004-05=100) rises 1.9% in September 2014 (y-o-y)


The Eight Core Industries comprise nearly 38% of the weight of items included in the Index of Industrial Production (IIP). The combined Index of Eight Core Industries stands at 160.6 in September 2014, which was higher compared to the index of September, 2013. Its cumulative growth during April to September, 2014-15 was 4.0%.
Coal 
Coal production (weight: 4.38 %) increased by 7.2% in September, 2014 over September, 2013. Its cumulative index during April to September, 2014-15 increased by 7.2% over corresponding period of previous year.
Crude Oil
Crude Oil production (weight: 5.22%) declined by 1.1% in September, 2014 over September, 2013. The cumulative index of Crude Oil during April to September, 2014-15 declined by 1.2% over the corresponding period of previous year.
Natural Gas
The Natural Gas production (weight: 1.71%) declined by 6.2% in September, 2014 over September, 2013. Its cumulative index during April to September, 2014-15 declined by 5.9% over the corresponding period of previous year.
Petroleum Refinery Products (0.93% of Crude Throughput) 
Petroleum refinery production (weight: 5.94%) declined by 2.5% in September, 2014 over September, 2013. Its cumulative index during April to September, 2014-15 declined by 2.6% over the corresponding period of previous year.
Fertilizers
Fertilizer production (weight: 1.25%) declined by 11.6 % in September, 2014 over September, 2013. While, it registered no growth during April to September, 2014-15 over the corresponding period of previous year.
Steel (Alloy + Non-Alloy)
Steel production (weight: 6.68%) increased by 4.0% in September, 2014 over September, 2013. Its cumulative index during April to September, 2014-15 increased by 2.3% over the corresponding period of previous year.
Cement 
Cement production (weight: 2.41%) increased by 3.2% in September, 2014 over September, 2013. Its cumulative growth during April to September, 2014-15 was 9.7% over the corresponding period of previous year.
Electricity
Electricity generation (weight: 10.32%) increased by 3.8% in September, 2014 over the period of September, 2013 and it registered a cumulative growth of 10.0% during April to September, 2014-15 over the corresponding period of previous year.
 

Sunday, 28th Dec 2014, 06:25:02 AM

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