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IIP growth in March cools to 2.7% on poor manufacturing show

LiveMint logoLiveMint 12-05-2017 Asit Ranjan Mishra

New Delhi: India’s index of industrial production (IIP) under the new 2011-12 base year showed less volatility and robust growth in 2016-17 as compared to the numbers under the old base year 2004-05.

Data released by the Central Statistics Office (CSO) showed that IIP grew 2.7% in March under the new series against 2.5% under the old series.

During 2016-17, IIP grew at a robust 5% under the new base year compared to 0.7% under the old base year, indicating the health of the industrial sector is not in as bad shape as previously indicated.

Under the new base year, while the mining sector has almost similar weights (14.4% in new series against 14.2% under old series), manufacturing has a higher weight at 77.6% under the new series against 75.5% under the old series. The weight of electricity in IIP under the new series has declined to 8% from 10.3% under the old series.

To reduce volatility in the capital goods segment, data in the new series will now be captured in terms of ‘work in progress‘ to better represent the growth in the segment and to avoid reporting of production figures in bulk after the completion of production.

Under the new series, manufacturing sector in March grew 1.2% while mining and electricity sectors grew 9.7% and 6.2% respectively.

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