Modi should thank India's chronic indigestion for factory growth

A few days ago, data issued by the Central Statistics Office showed that India's November factory output expanded at its fastest in just over two years, ostensibly driven by robust growth in manufacturing. The index of industrial production (IIP) rose 8.4% from a year ago.

What drove this spike in factory output?

Digestive enzymes, antacids, and proton pump inhibitors (PPIs), which are used to cure acidity, heartburn and indigestion.


Digestive enzymes and antacids topped the list of dominant item groups which positively contributed to the overall growth of IIP.

Digestive enzymes and antacids, which have a weight of just 0.22%, contributed 2.5497 percentage points to the growth. Electricity, which has a weight of 7.99%, contributed only 0.35 percentage points. Cement, with 2.16% weight, contributed just 0.3565 percentage points. HR coils and sheets of mild steel, carrying a weight of 1.35%, contributed 0.5365 percentage points.

Digestive enzymes and antacids (incl. PPI drugs) grew 110.7% in November. This is not the first time the item group has pushed up the IIP. It has been contributing majorly to the IIP growth for the past many months. In October, its contribution to IIP growth was 1.37 percentage points.

The item group had pushed up industrial production in May 2017 by 2.4 percentage points.

Does it mean more Indians opt for eating out or order food from home instead of eating home-cooked less-spicy food? Or is it just a statistical anomaly?