Industrial Sector (Part – II)

1. What was the industrial growth rate of India during 2013-14 with 2011-12 as the base year? [M.P.P.C.S. (Pre) 2014]

(a) 2.5 percent
(b) 3.5 percent
(c) 4.5 percent
(d) 5.5 percent

Correct Answer: (b) 3.5 percent

Solution:In 2013-14, India's industrial growth rate at constant prices (2011-12) was about 3.5%. As per the Second Advance Estimates (2023-24) and First Revised Estimates (2022-23) of National Income (released on 29 February, 2024), rate of growth of GVA at constant (2011-12) prices in Industry and its components in 2022-23 (1" R.E.) and 2023-24 (2nd A.E.) are as follows:

Component	2022-23 (1st R.E.)	2023-24 (2nd A.E.)
Mining & quarrying	1.9	8.1
Manufacturing	-2.2	8.5
Electricity, gas etc.	9.4	7.5
Construction	9.4	10.7
Industry	2.1	9.0

2. Assertion (A): There was an increase in industrial production during 1999-2000.

Reason (R) : The period witnessed a stable exchange rate and improved business sentiments.

Options:

(a) Both (A) and (R) are individually true, and (R) is the correct explanation of (A)
(b) Both (A) and (R) are individually true, but (R) is not the correct explanation of (A)
(c) (A) is true, but (R) is false
(d) (A) is false, but (R) is true

Correct Answer: (a) Both (A) and (R) are individually true, and (R) is the correct explanation of (A)

Solution:In the financial year 1999-2000, growth rate of industrial production was higher than the growth rate of the year 1998- 99. In the backdrop of South-East Asian crisis and nuclear test ban, exchange rate was dropped earlier, but in the period of 1999-2000, witnessed exchange rate stability and improved business sentiments which helped in increasing of industrial production. Consequently, both assertion and reason are correct and reason correctly explains the assertion.

3. Which of the following activities has not been included in the Industrial Production Index of India? [U.P.P.C.S. (Mains) 2016]

(a) Manufacturing
(b) Mining
(c) Electricity
(d) Construction

Correct Answer: (d) Construction

Solution:The Index of Industrial Production (IIP) is a composite indicator that measures the short-term changes in the volume of production of a basket of industrial products during a given period with respect to that in a chosen period. The IIP index is computed and published by the National Statistical Office (NSO) on a monthly basis. IIP measures the growth rate of industrial groups classified under:

1. Broad sectors, namely, Mining, Manufacturing and Electricity

2. Use-based sectors, namely Basic Goods, Capital Goods and Intermediate Goods. Construction, Gas and water supply etc. are not included in the IIP.

4. What is not included in the Industrial Product (IIP), which is the measure of industrial activities in the Indian Economy? [R.A.S./R.T.S.(Pre) 2021]

(a) Gas and water supply
(b) Electricity
(c) Manufacturing
(d) Mining

Correct Answer: (a) Gas and water supply

Solution:The Index of Industrial Production (IIP) is a composite indicator that measures the short-term changes in the volume of production of a basket of industrial products during a given period with respect to that in a chosen period. The IIP index is computed and published by the National Statistical Office (NSO) on a monthly basis. IIP measures the growth rate of industrial groups classified under:

1. Broad sectors, namely, Mining, Manufacturing and Electricity

2. Use-based sectors, namely Basic Goods, Capital Goods and Intermediate Goods. Construction, Gas and water supply etc. are not included in the IIP.

5. Which of the following agencies releases the Index of Industrial Production to measure industrial performance in India? [B.P.S.C (Pre) 2020]

(a) The National Sample Survey Office (NSSO)
(b) The Reserve Bank of India (RBI)
(c) The Central Statistics Office (CSO)
(d) The Indian Statistical Institute (ISI)
(e) None of the above/More than one of the above

Correct Answer: (e) None of the above/More than one of the above

Solution:The Index of Industrial Production (IIP) is an index which shows the growth rates in different industry groups of the economy in a stipulated period of time. Earlier, the IIP index was computed and released by the Central Statistical Office (CSO). At present, the base year for the IIP is 2011-12 and it is computed and released on a monthly basis by the National Statistical Office (NSO), which is formed with the merger of CSO and NSSO in 2019.

6. The new series for the Index of Industrial Production (IIP), which was released by Government of India on 10th June 2011, has changed the base year from 1993-94 to : [U.P.U.D.A./L.D.A. (Mains) 2010]

(a) 2001-02
(b) 2004-05
(c) 2008-09
(d) 2009-10

Correct Answer: (b) 2004-05

Solution:On 10th June 2011, the Government of India has shifted the base year of IIP from 1993-94 to 2004-05. Index of Industrial Production's current base year is 2011-12 since May 12, 2017. The weight of mining, manufacturing and electricity sectors are 14.37%, 77,63% and 7.99% respectively. The total number of items is 809 and number of item groups is 407.

7. In India, in the overall Index of Industrial Production, the Indices of Eight Core Industries have a combine weight of 37.90%. Which of the following are among those Eight Core Industries? [I.A.S. (Pre) 2012]

1. Cement

2. Fertilizers

3. Natural gas

4. Refinery products

5. Textiles

Select the correct answer using the codes given below :

(a) 1 and 5
(b) 2, 3 and 4
(c) 1, 2 3, and 4
(d) 1, 2, 3, 4 and 5

Correct Answer: (c) 1, 2 3, and 4

Solution:In India, eight industries are recognised as Core Industries, These are: Coal, Crude Oil, Natural Gas, Petroleum refinery products, Fertilizers, Steel, Cement and Electricity. The office of the Economic Advisor, Department for Promotion of Industry and Internal Trade, Ministry of Commerce & Industry releases the Index of Eight Core Industries (ICI) every month. At present, the Eight Core Industries comprise 40.27 percent of the weight of items included in the Index of Industrial Production (IIP).

8. Which is not included in 8 Crore Sector in India? [Chhattisgarh P.C.S. (Pre) 2016]

Correct Answer: (d) Chemical

Solution:In India, eight industries are recognised as Core Industries, These are: Coal, Crude Oil, Natural Gas, Petroleum refinery products, Fertilizers, Steel, Cement and Electricity. The office of the Economic Advisor, Department for Promotion of Industry and Internal Trade, Ministry of Commerce & Industry releases the Index of Eight Core Industries (ICI) every month. At present, the Eight Core Industries comprise 40.27 percent of the weight of items included in the Index of Industrial Production (IIP).

9. In the 'Index of Eight Core Industries', which one of the following is given the highest weight? [I.A.S. (Pre) 2015*]

(a) Coal production
(b) Electricity generation
(c) Fertilizer production
(d) Steel production

Correct Answer: (b) Electricity generation

Solution:

The Office of Economic Adviser, Department for Promotion of Industry and Internal Trade releases the 'Index of Eight Core Industries' (ICI) for every month with base 2011-12- 100. ICI measures combined and individual performance of production in selected Eight Core Industries. The Eight Core Industries comprise 40.27 percent of the weight of items included in the Index of Industrial Production (IIP). The weights (in %) of Eight Core Industries in ICI in descending order are as follows: 1. Refinery Products (28.0376), 2. Electricity (19,8530), 3. Steel (17.9166), 4. Coal (10.3335), 5. Crude Oil (8.9833), 6. Natural Gas (6.8768), 7. Cement (5.3720), 8. Fertilizers (2.6276).

Hence, in the ICI, highest weight is given to refinery products, but among the given options the highest weight is given to electricity generation.

10. During the year 2000-01, which one of the following industries recorded the highest growth rate in India? [I.A.S. (Pre) 2003]

(a) Cement
(b) Coal
(c) Electricity
(d) Steel

Correct Answer: (d) Steel

Solution:As per the question period, option (d) was the correct answer. According to the data released on 30 April, 2024 the growth rates (%) of 8 Core Industries of the country in recent years are as follows

Industry	2020-21	2021-22	2022-23	2023-24(p)
Cement	-10.8	20.8	8.7	9.1
Coal	-1.9	8.5	14.8	11.7
Electricity	-0.5	8.0	8.9	7.0
Steel	-8.7	16.9	9.3	12.3
Crude Oil	-5.2	-2.6	-1.7	0.6
Natural Gas	-8.2	19.2	1.6	6.1
Refinery Products	-11.2	8.9	4.8	3.4
Fertilizers	1.7	0.7	11.3	3.7
Overall Growth	-6.4	10.4	7.8	7.5