The government will phase out the Wholesale Price Index (WPI) over the next five years while simultaneously introducing a more detailed Producer Price Index (PPI), covering output, input and services prices, in a bid to offer a more realistic assessment of inflationary trends in the economy.

Speaking with reporters, Praveen Mahto, Principal Economic Adviser in the Commerce and Industry Ministry, said that the Department for Promotion of Industry and Internal Trade (DPIIT) will release the revised series of WPI with new base year 2022-23 on June 15, which would replace the existing series with base year 2011-12.

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In addition, the department would release a new series of PPI from June 15. It will have three indices — Output PPI, Trial Input PPI and Services PPI.

Initially, services PPI will have seven services — Banking, Securities Transaction, Insurance, Management of Pension Funds, Railways, Air (Passenger), and Telecom.

“Considering the wide usage of WPI in price escalation clauses, this index will be released for five years from the date of release of the revised series along with PPI and will be discontinued thereafter,” the Ministry said in a statement.

The five-year period would give users sufficient time to switch from WPI to PPI.

Mr. Mahto said that after five years, the PPI is expected to replace WPI.

The transition from WPI to PPI aligns with global best practices adopted by advanced economies and the recommendations of the International Monetary Fund (IMF).

The availability of both Output PPI and Input PPI provides a better understanding of the price movements of output items vis-à-vis the input items used in an industry.

It also explains how inflation experienced by producers of input items is passed through to the output they produce.

Mr. Mahto said that the Service PPIs for seven services have been compiled in the first phase based on the availability of data from administrative sources/agencies.

More services are planned to be added to the PPI basket of services in subsequent phases, subject to data availability.

The DPIIT informed that WPI and Output PPI are being compiled on monthly basis and will be available for the month of May 2026 (Provisional) alongwith the back series from April 2023 to April 2026 (37 months) on June 15.

The monthly Trial Input PPI (for the manufacturing sector only) will be published on an experimental basis from March 2026 onwards.

“This would enable the department to examine the data quality and also receive feedback from stakeholders and users. Service PPI, compiled on a quarterly basis, will be released for Q4 of 2025-26 (provisional) along with the back series from Q1 of 2023-24 to Q3 of 2025-26,” the Ministry said.

Speaking about the new series of WPI (2022-23), Dilip Kumar Sinha, Deputy Director General in the Office of the Economic Advisor, said the total number of items has increased from 697 to 957.

He said that new sources of energy, such as solar and wind, have been added under electricity group. In addition, nuclear electricity has been included in the basket.

Similarly, crude petroleum and natural gas have been shifted from the primary articles to the fuel and power.

This reorganisation would lead to better alignment, as this group already houses other major fuels such as coal, electricity, and petroleum products.

WPI, Output PPI, and Service PPI are compiled on the basis of basic price (which excludes net tax and trade and transport margins), whereas Input PPI is compiled using the purchaser’s price, since industries purchase inputs from the market.

WPI revision is a periodic exercise. Two major indices are used to track price movements — the Wholesale Price Index (WPI) and the Consumer Price Index (CPI). While the WPI measures price movements in wholesale markets, the CPI tracks inflation at the retail level and includes certain services.

WPI is a key indicator for measuring the average change in the prices of a fixed basket of commodities at the initial stage of a commercial transaction over a given period, with reference to a base year.

Ever since the introduction of the WPI in 1942 with the base year 1939, seven revisions have taken place, introducing new base years – 1952-53, 1961-62, 1970-71, 1981-82, 1993-94, 2004-05 and 2011-12.

The current WPI base year 2011-12 series was launched in May 2017.

Wholesale price inflation shot up to a 42-month high of 8.3% in April, driven by a spike in energy prices following disruptions caused by the West Asia conflict. Most countries in the world release output PPI and services PPI.

When asked whether government contracts that are currently have price-escalation clauses linked to the Wholesale Price Index (WPI) would be shifted to the Producer Price Index (PPI) in the coming years, Mahto said that the department of expenditure will come out with a circular “very soon” to inform all the users that “in a period of five years, we will be transiting from WPI to PPI. So, henceforth in case they want to enter into a long term contract then they should be using PPI rather than WPI”.

He also said that the PPI services will be released quarterly.

Major economies such as the US, China, Japan, Germany, France and other G-20 countries use PPI to measure the average changes in prices received by domestic producers for their output.

In January 2025, a working group was constituted under the chairmanship of then Niti Aayog Member Ramesh Chand for revision of WPI and compilation of PPI with base year 2022-23.

Published – June 02, 2026 08:19 pm IST

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The panel is expected to review the current system of price collection and suggest changes of its improvement, and decide on the computation methodology for the WPI and the PPI. File
| Photo Credit: Sushil Kumar Verma

The Centre on Thursday (January 2, 2025) announced the formation of an expert panel to revise the constituents of the country’s Wholesale Price Index (WPI) in light of the structural changes in the economy that have occurred between 2011-12, the current base year for the critical price gauge, and 2022-23 that would be the new base year.

The working group, to be steered by Niti Aayog member Ramesh Chand, would also examine the composition of, and the methodology for compilation of a new Producers’ Price Index or PPI, that has been approved by a technical advisory panel on Statistics of Prices and Cost of Living.

The group for revising the WPI and the PPI has been asked to submit its final report to the Office of the Economic Adviser in the Commerce and Industry Ministry within 18 months, effectively giving it a June 30, 2026 deadline.

As per the terms of reference of the 18-member panel that also includes some private sector economists, the group is expected to review the current system of price collection and suggest changes of its improvement, and decide on the computation methodology for the WPI and the PPI.

For the PPI, the panel has been asked to suggest further improvements in the compilation and presentation formats that are under consideration, and, more importantly, recommend a roadmap for India to switch over from the WPI to the PPI. At a broader level, it may also suggest any other improvements as may be necessary for enhancing the reliability of the two indices.

“The Chairman of the Working Group may co-opt experts/ representatives of other agencies, as may be considered necessary,” the Ministry said. Apart from Mr. Chand, the panel includes eight officials from the Ministries of Statistics, Finance, Petroleum and Natural Gas, Agriculture, and Consumer Affairs. A Reserve Bank of India (RBI) representative and the Chief Executive Officer of the Goods and Services Tax Network have also been roped in.

From the private sector, Crisil chief economist Dharmakirti Joshi, Bank of America Merill Lynch economist Indranil Sengupta, and Kotak Mahindra Asset Management managing director Nilesh Shah, have been named as members of the working group.

Two other non-official members in the panel are PM’s Economic Advisory Council member Shamika Ravi, and economist Surjit Bhalla.

New Delhi:

Wholesale inflation fell for the second consecutive month to 1.31 per cent in August due to cheaper vegetables, food and fuel, government data released on Tuesday showed.

The wholesale price index (WPI) based inflation was 2.04 per cent in July. It was (-) 0.46 per cent in August last year.

“Positive rate of inflation in August 2024 is primarily due to increase in prices of food articles, processed food products, other manufacturing, manufacture of textiles and manufacture of machinery & equipment etc,” the industry ministry said in a statement.

As per the data, inflation in food items was 3.11 per cent in August against 3.45 per cent in July. This was led by declining prices of vegetables, which recorded a deflation of 10.01 per cent in August compared to 8.93 per cent in July.

Inflation in potatoes and onions continued to be high at 77.96 per cent and 65.75 per cent in August.

The fuel and power category witnessed deflation of 0.67 per cent in August against inflation of 1.72 per cent in July.

Data released last week showed retail inflation was at 3.65 per cent in August on higher prices of vegetables. This was higher than 3.60 per cent in July.

The Reserve Bank of India (RBI), which mainly takes into account retail inflation while framing monetary policy, kept the benchmark interest rate or repo rate unchanged for the ninth consecutive time in August at 6.5 per cent. 

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)

On a month-on-month basis, the WPI was 0.07% higher, with primary articles rising 0.22% and the Food Index up 0.17%.
| Photo Credit: PTI

India’s wholesale price inflation moderated to a four-month low of 0.2% in February from 0.27% in January, despite an acceleration in food and primary articles’ inflation rates, owing to a sharper year-on-year drop in manufactured products and fuel and power prices.

The Wholesale Food Index (WPI) picked up from 3.8% in January to 4.1% in February, while primary articles’ prices rose 4.5%, compared with 3.84% in the previous month. On a month-on-month basis, the WPI was 0.07% higher, with primary articles rising 0.22% and the Food Index up 0.17%.

Eight of 10 primary food articles recorded higher price rise than January, with five items recording double-digit inflation, including vegetables (19.8%), onion (29.22%), pulses (18.5%) and paddy (10.25%). Potato prices recorded a 15.3% spurt, after at least five months of deflation.

Cereals and wheat inflation hit a three-month high of 6.6% and 2.3%, respectively. Fruit prices dropped 4% in February, while eggs, meat and fish recorded a 0.47% year-on-year decline in prices, the mildest dip in three months. 

Fuel and gas prices

Among non-food primary articles, crude petroleum inflation surged to a 14-month high of 16.65%. LPG prices which have been slashed by ₹100 earlier this month, rose 3.8% in February, compared to 0.4% in January. However, overall fuel and gas prices were 1.6% lower than February 2023, marking the sharpest deflation rate in three months.

Eight of 14 manufactured products’ categories recorded price drops from last February, with the overall segment seeing a 1.27% decline in prices, the steepest since October 2023. 

February marks the fourth successive month that the WPI has risen on a year-on-year basis, after seven months of deflation. The Commerce and Industry Ministry raised the wholesale inflation rate for December 2023 to 0.86% from the 0.73% uptick estimated earlier.

“Positive rate of inflation in February, 2024 is primarily due to increase in prices of food articles, crude petroleum & natural gas, electricity, machinery & equipment and motor vehicles, trailers & semi-trailers,” the Ministry said in a statement.

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Benchmark equity indices tumbled in early trade on October 9 as escalating tensions in Middle East triggered a risk-off in the market.

Market analysts said investors preferred to remain on the sidelines and refrained from taking big risks as the Israel-Hamas conflict has introduced a huge uncertainty for the markets The 30-share BSE Sensex plunged 407.19 points or 0.62% to 65,588.44 points in early trade. The Nifty declined 142.70 points or 0.72% to 19,510.80 points.

State Bank of India, Tata Steel, Titan, IndusInd Bank and Asian Paints were among the major laggards. On the other hand IT majors HCL Technologies, Tech Mahindra, TCS, Wipro and Infosys, Hindustan Unilever and Sun Pharma defied the broader market trend and were trading in the positive territory.

The BSE benchmark had climbed 364.06 points or 0.55% to settle at 65,995.63 points on Friday. The Nifty had advanced 107.75 points or 0.55% to end at 19,653.50.

“The Israel-Hamas conflict has introduced a huge uncertainty for the markets. Nobody knows how this war is going to evolve,” V. K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said.

He said that even though it is unlikely to cause major disruption in oil supplies at present, the situation will change if Iran, a major Hamas supporter, is drawn into the war. “That can disrupt oil supplies causing a spike in crude, which can trigger a risk-off in the market. This is a time to be cautious,” he added.

Traders are also expected to remain cautious ahead of macroeconomic data to be announced later this week. The industrial production and manufacturing data for August are scheduled to be announced on October 12. Simultaneously, inflation rate for September will be announced followed by Wholesale Price Index (WPI) data on October 13.

On Friday, the Reserve Bank of India expectedly left its key interest rate unchanged and signalled it would keep liquidity tight using bond sales to bring prices closer to target.

The six-member monetary policy committee of RBI held the benchmark repurchase rate (repo) at 6.50% in a unanimous decision for the fourth consecutive meeting in a row. It also retained a ‘withdrawal of accommodation’ stance. Asian markets are trading lower on Monday as Chinese and Hong Kong shares fell.

European markets finished broadly higher on Friday with Germany’s DAX gaining 1.06%. France’s CAC 40 was up 0.88% and London’s FTSE 100 closed 0.58% higher.

The U.S. markets ended higher on Friday with S&P 500 closing with a gain of 1.18% and Dow Jones Industrial Average Index up 0.87%.

Meanwhile, global oil benchmark Brent crude witnessed a sharp rise of 3.68% to $87.69 a barrel on Monday. Foreign Institutional Investors (FIIs) offloaded equities worth ₹90.29 crore on Friday, according to exchange data.

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| Photo Credit: Reuters

The wholesale price based inflation remained in the negative territory for the fourth straight month in July at (-)1.36% on easing prices of fuel, even though food articles turned costlier.

The wholesale price index (WPI) based inflation rate has been in the negative since April and was (-)4.12% in June. In July last year it was 14.07%.

Inflation in food articles skyrocketed 14.2% in July against 1.32% in June.

“Decline in the rate of inflation in July, 2023 is primarily contributed by fall in prices of mineral oils, basic metals, chemical & chemical products, textiles and food products,” the commerce and industry ministry said on August 14.

Fuel and power basket inflation eased to (-)12.79% in July from (-)12.63% in June.

In manufactured products, the inflation rate was (-)2.51% as against (-)2.71% in June.

The RBI last week kept interest rates unchanged at 6.5% for the third straight meeting but signalled tighter policy if food prices drive inflation higher.

“The job on inflation is still not done,” RBI Governor Shaktikanta Das had said.

“Inflationary risks persist amidst volatile international food and energy prices, lingering geopolitical tensions and weather-related uncertainties.”

The RBI raised its inflation forecast for the current financial year ending March 2024 to 5.4% from 5.1% earlier, citing pressures from food prices.

The Central bank takes into account retail or consumer price index based inflation for formulating monetary policy. Retail inflation data for July is scheduled to be released later in the day.