What is IIP and the Insolvency & Bankruptcy code?

By | August 4, 2022

The national economy is something that we cannot ignore. After all, it determines the country’s future and will also highlight whether the earning capacity or the inflation is increasing or not. Thus industries across the nation are established among which there are many industries belonging to capitalists and the government. So, when there is a matter of evaluation, what kind of metrics or indexes are there to showcase the performance of industries. The IIP or the Index of Industrial Production is a government provided index showing the performance of various Indian industrial sectors.

The CSO (Central Statistical Organisation) publishes these indexes monthly. Moreover, it acts as a compositor index in our Indian economy’s industrial activities. And those sectors that do not perform well approach IBC (Insolvency and bankruptcy code). To gain more insight on the IBC, we recommend you to refer to Insolvency and bankruptcy code UPSC notes.

Know all about the IIP

As we have mentioned above, the Index of Industrial Production or IIP is a data that indicates the different sectors’ manufacturing activities in a given period. this index is measured monthly and there is one reference period also included in the same. to understand the economic scenario of our nation, this IIP plays a key economic indicator role in our national manufacturing economy. If you are looking at the minimum period between two IIP indexes, there is a lag of six weeks. 

data or IIP as it is commonly called is an index that tracks manufacturing activity in different sectors of an economy. The IIP number measures the industrial production for the period under review, usually a month, as against the reference period. IIP is a key economic indicator of the manufacturing sector of the economy. There is a lag of six weeks in the publication of the IIP index data after the reference month ends. IIP index is currently calculated using 2011-2012 as the base year. There are several components included in this index. In total there are eight, and those are:

Cement, steel sector, refinery products, electricity, crude oil, coal, natural gas, and fertilizers are those industries that gain the weightage of approx. 40% of the IIP. Those who want to refer to such indexes and want to see where such data are available, it is the PIB website where CSO releases the index report. The CSO comes under the Ministry of Statistics and Programme Implementation (MoSPI). 

What is meant by the IBC?

The Insolvency and Bankruptcy Code or IBC was established in 2016 to carry out the process of insolvency of our sectors in our nation. As a result, the Indian government has established an important board named as the Insolvency and Bankruptcy Board of India (IBBI). Below we have highlighted some of their major roles in what this board does:

IBBI is basically a regulating authority to proceed with insolvency and bankruptcy processes in our nation.

Also, there are different insolvency bodies like Information Utilities (IU), Registered Valuers, and Registered Valuer Organisations, Insolvency Professional Agencies (IPA), Insolvency Professionals (IP) whose activities are overseen by IBBI. 

IBBI in 2016 was established as a statutory body under the Insolvency and Bankruptcy Code, 2016.

 

The IBBI board is responsible to govern the insolvency processes of the corporate sector. Also, for individuals as well. Moreover, they take some measures for the corporate liquidation. 

The board emerges as the main pillar of IBC that regulates processes for our country’s economic betterment.

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