Connecting the Dots: Climate Impact on India's Industrial Production
UPSC Relevance
Prelims: Indian Economy (Index of Industrial Production - IIP, Core Industries), Environment (Climate Change, Monsoon), Governance (Ministry of Statistics and Programme Implementation - MoSPI, Reserve Bank of India - RBI).
Mains:
GS Paper 3: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment; Infrastructure: Energy; Conservation, environmental pollution and degradation, environmental impact assessment.
Key Highlights from the News
The Index of Industrial Production (IIP) growth in June 2025 reached a 10-month low of 1.5%.
This was primarily due to a significant decline in mining activity and electricity output.
The early arrival of the southwest monsoon, along with its irregular distribution, caused waterlogging in mining areas in states like Odisha and Jharkhand, leading to the decline in the mining sector.
Industrial growth is mainly sustained by the government's infrastructure spending.
The article criticizes official economic reports in India for their reluctance to link economic activities with climate-related events.
Agencies like MoSPI and RBI typically attribute economic slowdowns to traditional reasons such as 'base effect' and 'supply chain disruptions'.
Institutions like the European Central Bank have already started incorporating climate risk frameworks into their economic reports.
The article argues that India needs to make a systemic change to include climate attribution in reports on economic activities.
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