Q. Consider the following statements:
1. The share of Gross Capital Formation of the industrial sector had continuously declined from last ten years.
2. The eight-core industries have a total weight of nearly 50 percent in the Index of Industrial Production.
Which of the statements given above is/are correct?
Answer: D
Notes:
The eight-core industries that support infrastructure, such as coal, crude oil, natural gas, refinery products, fertilizers, steel, cement, and electricity have a total weight of nearly 40 percent in the IIP.
- The rate of growth of Gross Capital Formation (GCF) in industry registered a sharp rise from 1.2 per cent in FY18 to 17.5 per cent in FY19, showing a substantive improvement in GCF in the sector.
- Mining & Quarrying, Manufacturing, ‘Electricity, Gas, Water Supply & Other Utility Services’ and Construction had registered a growth rate of 14.9 per cent, 15.9 per cent, 15.3 per cent, and 24.4 per cent respectively in FY19.
- However, the share of GCF of the industrial sector had declined from 38.2 per cent in FY12 to 30.2 per cent of GDP in FY18 before an uptick (31.9 per cent) was recorded in FY19.
Source: Economic Survey 2020 – 2021
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