Why in news?
India’s Ministry of Statistics and Programme Implementation released a new National Industrial Classification 2025 (NIC‑2025) to replace the earlier 2008 classification. The updated manual introduces a six‑digit coding system and new classes to capture the rapid growth of digital services, renewable energy and other modern sectors. It aims to provide more precise data for surveys, censuses and economic policy.
Background
The National Industrial Classification is India’s standard for categorising economic activities. It is used in censuses, surveys and national accounts to organise data on agriculture, industry and services. The first version was issued in 1962 and has been periodically revised (1970, 1987, 1998, 2004 and 2008) to reflect structural changes in the economy. By 2025 the country’s economy had shifted dramatically toward services, e‑commerce and renewable power, making another update necessary.
The NIC‑2025 aligns its structure with the International Standard Industrial Classification (ISIC) Revision 5, ensuring international comparability. It introduces a six‑digit code in place of the previous five digits, increasing the number of subdivisions so that newer activities can be separately identified. Sections are identified by letters (A–V), while divisions (two‑digit codes), groups (three‑digit codes) and classes (four‑digit codes) are similarly expanded.
Key features
- Enhanced intermediation services: New classes describe activities of intermediaries in retail, logistics, power, healthcare, education, real estate and food services, reflecting the growing role of platform‑based services and aggregators in India’s economy.
- Digital economy representation: The classification explicitly lists activities such as cloud infrastructure provision, web‑search portals, blockchain services, online marketplaces and other digital platforms. This ensures that the expanding online economy is captured in official statistics.
- Green economy integration: Sectors related to renewable energy, carbon capture, waste management, recycling and environmental remediation are given separate codes, recognising India’s transition toward sustainable development and commitments under the Sustainable Development Goals.
- Recognition of indigenous sectors: Traditional and indigenous activities—such as Ayush‑based healthcare, handloom weaving and rural crafts—are better represented to capture their contribution to employment and culture.
- Technology‑agnostic classification: Activities are classified by the nature of the output rather than the technology used. For example, taxi services are grouped together whether bookings occur via an app or through a telephone call.
Significance
The NIC‑2025 provides a contemporary framework for measuring India’s fast‑changing economy. By offering finer granularity, it will improve the quality of GDP estimation, labour statistics and sector‑wise planning. Policymakers can better identify emerging trends in the digital and green economies, researchers can benchmark data against international standards, and businesses can align their reporting with a common coding system. The classification also supports evidence‑based policymaking by capturing activities that were previously grouped under broad categories.
Source: PIB · Legality Simplified · Business Standard