Industry and Infrastructure

IAS Prelims 2023
  • As per recently released data on national accounts, with 2011-12 as base year, industrial growth in 2012-13 and 2013-14 at 2.4% and 4.5% is much better than the growth rates taking 2004-05 as the base year.
  • Further, the 1.4% growth in gross capital formation (GCF) in industry in 2013-14 implies that recovery in industrial growth commenced last year.
  • In contrast, the Index of Industrial Production (IIP) suggests that the industrial sector is recovering slowly with a 2.1% growth in April-December 2014-15 over the 0.1% increase in the same period last year.
  • In the road sector efforts have been undertaken to resolve problems associated with projects which are yet to be completed and the National Highways and Infrastructure Development Corporation Ltd. Has been set up for speedy implementation of highway projects in the north-east.
  • A monthly index of eight core industries, viz. coal, fertilizer, electricity, crude oil, natural gas, refinery product, steel, and cement, comprising 38% of the weight of items in the IIP, is released to gauge the impact on overall economic activity. A comparison between the annual average growth rate in the eight core industries and the IIP shows that since 2011-12 the higher annual growth of the eight core industries than of the IIP, implies slowdown in the growth of consumer goods.
  • The overall growth in eight core industries during April-December 2014-15 has improved marginally to 4% compared to 4.1% in the same period last year.
  • Electricity (9.7%), coal (9.1%), and cement (7.9%) boosted the performance, while natural gas (-5.1%), fertilizers (-1.4%), crude oil (-0.9%), refinery products (0.2%), and steel (1.6%) accounted for moderation in growth.
  • The improved performance in electricity is due to high growth in thermal generation; in coal mining to higher production by Coal India Ltd. and captive mining; and in cement to capacity addition. Natural gas and crude oil production have declined because of no major discoveries and problems with old oilfields.
  • Domestic steel production is affected by slowdown in domestic demand and cheaper imports. Fertilizer production has contracted mainly because of non-availability of gas and no significant capacity addition in the past few years. India accounts for 1.8% of the world are manufacturing output.
  • As per the latest data available on national income, consumption expenditure, and capital formation at constant 2011-12 prices, the rate of growth of GCF has declined from 37.2% in 2012-13 to 4% in 2013-14.
  • The 3.61 crore (MSMEs), contributing 37.5% of the country’s GDP, have a critical role in boosting industrial growth and ensuring the success of the Make in India programme.
  • A total of 290 CPSEs existed under the administrative control of various ministries/ departments as on 31 March 2014. Of these, 234 were operational and 56 under construction.
  • Financial investment (paid-up capital + long-term loans) in all the CPSEs stood at 9,92,971 crore as on 31 March 2014 showing an increase of 17.46% over 2012-13.

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