ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Comparing IIP and NAS in Their New Incarnations

The Index of Industrial Production series, the most significant macroeconomic lead indicator, was revised by the Central Statistics Office in May 2017, two years and three months after revising the National Accounts Statistics series. Even as the newIIP series is more current, growth rates of output do not match those of theNAS. This, along with the significant lag in the periodic revision ofIIP, diminishes its usefulness.

For a long period, the Index of Industrial Production (IIP) of the 2004–05 series remained an outlier in comparison with the trends depicted by many other macroeconomic lead indicators.1 One of the main reasons for the critical comments received over the new National Accounts Statistics (NAS) 2011–12 series were the observed divergence growth rates of the manufacturing sector between the then IIP (2004–05) series and the new NAS. After about two years and three months of the release of NAS 2011–12 in January 2015, the Central Statistics Office (CSO), in May 2017, released the new IIP series with 2011–12 as the base (CSO 2017a). The data of the new and old IIP series are now available for five years from 2011–12 to 2016–17, which provides an opportunity to compare industrial growth in both the series, and also between the new IIP series and NAS, which this note aims to do. As is evident presently, this comparison brings out the extent of gaps that existed in accurately representing the industrial growth scenario.

Structural Changes in IIP

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Updated On : 29th Sep, 2017
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