Your smartphone could end up in new series for IIP tomorrow: Know what that means

For more accurate mapping of economic activity, the government will release tomorrow the new series of Index of Industrial Production (IIP) as well as Wholesale Price Index (WPI). Experts have been demanding release of new series of WPI and IIP for long.

The base year will be changed from 2004-05 to 2011-12. The old base year misses out on important developments in the economy since then.

The Central Statistics Office (CSO) has already changed the base year for the country's national accounts, including the gross domestic product (GDP) and the gross value addition (GVA). The retail inflation based on the Consumer Price Index ( CPI) is also calculated on the base year of 2011-12.

IIP numbers with old base year reflect divergence with the GDP numbers on the industrial sector manufacturing. Better syncronisation among important sets of data will lead to better policy making.

The base year is revised periodically to capture the changes in the structure and composition of the industry over time due to technological changes, economic reforms and consumption pattern of the people.

The new series will include many new items too. Smartphones, laptops and tablets will be included in the new series of the IIP while chocolates, noodles, harmonium, guitars, cricket bats and balls will be included in the new WPI series. The inclusion of new items will make the data more realistic.

The IIP gives a broad outlook on output of various types of goods like basic, consumer and capital ones, which helps in gauging the level of economic progress and investments in the economy. According to experts, the updated series would show higher growth in factory output measured by the IIP.