Gs-3 : Economic growth- Economic indicators Index of Industrial Production (IIP) is losing relevance as an economic indicator- Reasons? 1. Divergence from GDP Growth: IIP prints increasingly produce results that are out of sync with GDP trends 2. Obsolete Base Year: The base year of the IIP, which is essential for comparison over time, is not updated frequently enough. 3. The IIP uses a fixed weighting system for the various sectors it measures, which may not accurately reflect the current industrial landscape 4. Services not exactly reflected 5. The index does not adequately account for new goods like smart phones 6. skewed towards certain sectors like automobile production 7. Lack of Real-Time Data-IIP has not kept pace with technological advancements 8. IIP may not fully capture the complexities of global supply chain dynamics VK IAS subject wise channels - Click here 13.8K viewsedited 03:09
