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Index of Industrial Production and Index of Core Industries: the 2022-23 base

By CAShorts DeskPublished Source: PIB (MoSPI, 28 Oct 2026); MoSPI FAQs on the 2022-23 IIP series; Office of the Economic Adviser, DPIIT

Why in news: On 28 October 2026 MoSPI released the Quick Estimates of the IIP for September 2026, compiled on the new 2022-23 base.

Index of Industrial Production and Index of Core Industries: the 2022-23 base
Illustration (AI-generated)

The Index of Industrial Production (IIP) tracks the volume of factory, mine and utility output against a base year, now 2022-23. The National Statistics Office (NSO) of MoSPI compiles it every month. The Index of Core Industries, from DPIIT's Office of the Economic Adviser, follows nine key industries. MoSPI's Quick Estimate put IIP growth at 6.7% in September 2026.

Syllabus: GS3 · Indian Economy & Growth; Prelims · Current Affairs & IR

Why this matters for UPSC

GS3 economy: growth indicators, the IIP and the Index of Core Industries. Prelims can ask who compiles each index and its weights; Mains, why base years need revision.

In short

The Index of Industrial Production (IIP) is a monthly volume index of industrial output, compiled by the National Statistics Office (NSO) of MoSPI against a fixed base year.

IIP sectors in the2022-23 baseManufacturingdominatesMiningElectricity andgasWater and waste

The 2022-23 base makes the IIP truer to today's industry; its value now depends on timely revisions and on reading trends over single monthly prints.

Why it matters

A policymaker deciding whether industry needs support has to know, month by month, whether factories are making more or less. The IIP answers that question quickly, weeks before fuller national accounts arrive, and the core index answers part of it even sooner. An old base year blurs that picture: it keeps counting products that have faded, such as kerosene and fluorescent tubes, and misses new ones such as stents and CCTV cameras. Moving to 2022-23 brings the basket closer to what Indian industry now makes. Readings from the two indices then feed judgements on growth and on where industrial demand is rising or slowing.

Prelims pointers

  • The NSO under MoSPI compiles the IIP; the Office of the Economic Adviser in DPIIT, Ministry of Commerce and Industry, compiles the Index of Core Industries.
  • The IIP's six use-based groups are primary, capital, intermediate, infrastructure/construction goods, consumer durables and consumer non-durables; the 2022-23 series kept all six.
  • IIP sectoral weights follow each sector's share in Gross Value Added at current prices; manufacturing item weights follow Gross Value of Output in the Annual Survey of Industries.
  • On the 2011-12 base, the eight core industries were coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity.
  • Before the 2004-05 series the core index had six industries; fertilisers and natural gas joined in 2004-05.
  • The core index is built with the Laspeyres fixed-base formula, a weighted average of each industry's output relative to its base-year output (OEA note, 2011-12 base).

Practise a UPSC-style question

With reference to the Index of Industrial Production (IIP) in India, consider the following statements:

1. It measures changes in the value added by industry at current prices over a base year.

2. It is compiled and released by the National Statistics Office under the Ministry of Statistics and Programme Implementation.

3. In its new series, sectoral weights follow each sector's share in Gross Value Added at current prices in 2022-23.

Which of the statements given above is/are correct?

  1. (a) 1 and 2 only
  2. (b) 2 and 3 only
  3. (c) 1 and 3 only
  4. (d) 1, 2 and 3
Show the answer

Answer: (b) 2 and 3 only

Answer: (b) 2 and 3 only. The IIP is a volume index compiled by the NSO; GVA only sets its weights.

Statement 1: incorrect. MoSPI describes the IIP as a measure of change in the volume of production of an item basket, not of value added.

Statement 2: correct. MoSPI's FAQs state that the National Statistics Office in MoSPI compiles and releases the IIP.

Statement 3: correct. In the 2022-23 series, sectoral weights rest on each sector's share in GVA at current prices in 2022-23.

Eliminate: statement 1 is wrong because the IIP counts volume, not value added. Out: (a), (c), (d).

Trap: Look-alike names. GVA appears in the IIP only as the source of its weights; the statement turns that link into what the index measures.

Remember: IIP measures volume; GVA shares only decide how much each sector weighs.

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