Industrial production index gets 2022-23 base year

India rebases its monthly factory-output barometer from 2011-12 to 2022-23 — its 10th revision since 1937 — widening the basket to gas, water, sewerage and rare-earth minerals.

What happened

• The Ministry of Statistics & Programme Implementation (MoSPI) is shifting the base year of the All-India Index of Industrial Production (IIP) from 2011-12 to 2022-23, with the new series scheduled to go live on 1 June 2026.
• The change was carried out by the Technical Advisory Committee for base-year revision of the All-India IIP (TAC-IIP), whose report was released on 25 May 2026.
• The new item basket carries 463 item groups — including 120 newly added groups, with 64 older groups dropped — reflecting how the structure of Indian industry has shifted across a decade.
• Coverage now reaches beyond the three traditional sectors (mining, manufacturing, electricity) into minor minerals, rare-earth minerals, gas supply, and water supply, sewerage and waste management.
• MoSPI issued the change as a Frequently Asked Questions note, signalling that the revised series will continue to be released monthly with a 28-day lag and made available on the e-Sankhyiki Portal.

Background & context

A production index is only as honest as the economy it photographs. Because the IIP measures the volume of output against a fixed reference year, that reference must be refreshed periodically — otherwise the basket of goods being tracked drifts away from what factories, mines and utilities actually make. Goods that have faded (older consumer items, obsolete machinery) keep weighing on the number, while fast-growing modern products go uncounted. Rebasing resets the reference point and re-weights the basket so the index again mirrors the real productive economy.

The IIP is one of India's oldest official statistics. The first index was prepared with a base year of 1937. Successive revisions followed in 1946, 1951, 1956, 1960, 1970, 1980-81, 1993-94, 2004-05 and 2011-12. The move to 2022-23 is therefore the 10th base-year revision in the series' history. The choice of 2022-23 is deliberate: it is a post-pandemic year considered structurally more representative than the disrupted 2020-21 or 2021-22, and it aligns the IIP base with the base year being adopted across India's other macro statistics (such as the GDP/National Accounts and the Wholesale Price Index rebasing exercises), so the family of indicators speaks a common reference language.

The IIP is compiled and released by the National Statistics Office (NSO), the statistical wing housed within MoSPI. The NSO is the body formed by merging the erstwhile Central Statistics Office (CSO) and the National Sample Survey Office (NSSO), and it is the single agency responsible for India's core official statistics. The base-year exercise itself is steered by an expert Technical Advisory Committee (TAC-IIP) — the standing practice for major statistical revisions, where domain experts vet the item basket, the weighting diagram and the methodology before the new series is notified.

It helps to place the IIP within India's wider family of economic indicators. The Wholesale Price Index (WPI) and the Consumer Price Index (CPI) measure prices; the IIP measures quantity of output. The GDP / National Accounts measure value added across the whole economy, including services and agriculture, whereas the IIP is confined to the industrial sector. The closest cousin to the IIP is the Index of Eight Core Industries (ICI) — coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity — which together make up a large share of the IIP's manufacturing and mining weight and are released a little earlier each month as an advance signal. A common exam trap is to conflate the two: the ICI is a focused infrastructure-industries index, while the IIP is the comprehensive industrial-output index that the ICI feeds into. Knowing this distinction, and that the IIP is a volume index built on the Laspeyres fixed-base formula, is usually enough to clear a statement-based question.

On methodology, the Laspeyres approach fixes the basket and the weights at the base period and tracks how the quantity of those goods moves over time. Its strength is comparability and simplicity; its known limitation is that, as the base year ages, the fixed weights drift away from current consumption and production patterns, which is precisely why periodic rebasing is necessary rather than optional. The weighting diagram for the new series is rebuilt from base-year-2022-23 production data, so each item's contribution to the headline number now reflects its present share of industrial output. Manufacturing continues to carry the dominant weight among the three sectoral groups, with mining and electricity making up the remainder. The use of NIC 2025 — the latest National Industrial Classification — ensures the new industries are slotted into an internationally comparable coding structure, and the continued use of the WPI as a deflator for value-based items keeps the volume measure clean, with the door left open to an Output Producer Price Index in future.

For Prelims

• What it is: the IIP is a composite index that measures changes in the volume of industrial production over time relative to a base year; it is a quantity (volume) index, not a value or price index.
• Compiled & released by: the National Statistics Office (NSO) under MoSPI. Steered for this revision by the TAC-IIP.
• Base year: revised from 2011-12 → 2022-23; new series launches 1 June 2026; TAC-IIP report released 25 May 2026.
• Revision count: this is the 10th base-year revision; the first IIP used base year 1937. The full chain: 1937 → 1946 → 1951 → 1956 → 1960 → 1970 → 1980-81 → 1993-94 → 2004-05 → 2011-12 → 2022-23.
• Item basket: 463 item groups; 120 new groups added, 64 dropped.
• New coverage: minor minerals · rare-earth minerals · gas supply · water supply, sewerage and waste management — added on top of the existing three sectors: mining, manufacturing, electricity.
• New item examples: cards with magnetic stripe, CCTV cameras, stents, vaccines — illustrating the shift toward electronics, medical devices and healthcare goods.
• Formula: the Laspeyres fixed-base type index formula (base-period quantity weights held fixed).
• Six use-based categories (retained): Primary goods · Capital goods · Intermediate goods · Infrastructure/Construction goods · Consumer Durables · Consumer Non-Durables.
• Three sectoral categories: Mining · Manufacturing · Electricity (manufacturing carries by far the largest weight).
• Classification used: the latest NIC 2025 (National Industrial Classification).
• Release cadence: monthly, with a 28-day lag; data accessible from the e-Sankhyiki Portal (MoSPI). WPI is used as the deflator for value-based items (an Output PPI to be examined later).
• What it is NOT: the IIP is not a price index — that is the WPI/CPI. It is not a measure of GDP or value added. Its base year is not the same as the CPI base or the GDP base unless separately aligned. It does not, by itself, capture the unorganised/informal sector comprehensively, and it tracks volume, not turnover. The Eight Core Industries Index (the eight infrastructure industries) is a related but separate series — it is a component pulled out for early signalling, not the IIP itself.

Why it matters

The IIP is one of the most closely watched high-frequency indicators of the economy. It arrives faster than GDP, so policymakers, the RBI and markets read it as an early signal of the momentum of the industrial economy — whether factories, mines and power plants are speeding up or slowing down. A stale base year quietly corrodes that signal: the basket no longer matches what is being produced, weights drift, and the index can flatter or understate real activity. Rebasing to 2022-23 restores the index's fidelity to the present industrial structure.

The widened coverage is the substantive part of this revision. By bringing in rare-earth minerals, the index begins to track a strategically critical mineral class that sits at the heart of electronics, defence and the clean-energy transition. Adding gas supply and water supply, sewerage and waste management extends the index into utilities and the sanitation economy that earlier sat outside the frame, while minor minerals capture a swathe of quarrying activity previously under-measured. New items such as CCTV cameras, magnetic-stripe cards, stents and vaccines mark the migration of Indian output toward electronics, digital-payment hardware and medical devices. Aligning the base with the other macro series, and adopting NIC 2025, lets analysts compare industrial output against national accounts and prices on a common footing — reducing the distortions that creep in when each indicator carries a different reference year.

For Mains

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