New WPI series out on June 15, but to be replaced by Producer Price Index in 2031
The release of a revised WPI series and an output PPI continues the government’s overhaul of India’s official statistics, with the CPI, GDP, and IIP having been updated so far in 2026.
The commerce ministry, on June 15, will release the new Wholesale Price Index (WPI) series with 2022-23 as the base year, starting with data for May as well as a back-series from April 2023 onwards. However, this new year series will in all likelihood be discontinued after five years in 2031 and the Producer Price Index (PPI) based on output prices will become the main measure of non-retail inflation.
While inflation based on the Consumer Price Index (CPI) is the most widely considered measure of price increases in the country for households and used by the Reserve Bank of India (RBI) to decide interest rates, the WPI is crucial too and used in price escalation clauses in the supply of raw materials, machinery, and construction work.
For example, in long-term sales and purchase contracts, WPI inflation is used by companies as an indexing tool to adjust terms to account for changes in prices in the future. The Ministry of Finance’s Department of Expenditure will issue a circular on the same, Praveen Mahto, Principal Economic Adviser in the commerce ministry’s Department for Promotion of Industry and Internal Trade (DPIIT), said on Tuesday.
“The purpose of the circular would be to tell users of WPI that the government has decided we’ll be transitioning from WPI to PPI in a period of 5 years. So now, when you enter into any fresh contract which is of long-term nature and will go beyond 2031, then you have to start using PPI,” Mahto said. He did not specify when the Department of Expenditure will issue the aforementioned circular.
The new WPI series as well as the release of an output PPI continues the government’s overhaul of India’s official statistics.
Earlier this year, the Ministry of Statistics and Programme Implementation (MoSPI) not only updated the base years for CPI and GDP data but also improved the methods used to calculate these key economic indicators.
On Monday, MoSPI released its revised Index of Industrial Production (IIP) series, with 2022-23 as the base year. MoSPI is also working on the services sector counterpart of the IIP.
Along with the new WPI series, the commerce ministry will, on June 15, also release three different types of Producer Price Indices. These include the monthly output PPI – for May as well as a back-series starting from April 2023 – and a monthly input PPI for the manufacturing sector on an experimental basis starting with March. It is expected the input PPI trial will last for around a couple of years, during which time the quality of data is examined and feedback from the users of data and other stakeholders are discussed.
The output PPI helps measure the prices received by producers and excludes net tax as well as trade and transport margins. A year-on-year change in the output PPI will be the output PPI inflation. To begin with, the output PPI will contain 125 items. Once the WPI is discontinued, the items in the output PPI will be disaggregated and rise to around 1,500.
Meanwhile, input PPI measures the prices paid by producers to buy inputs, which includes trade and transport margin. PPIs also cover services, while the WPI basket only contains goods.
According to officials, while the output PPI is similar to the WPI, the input PPI is closer to CPI.
Economists and organisations such as the International Monetary Fund have repeatedly called on the government to develop PPIs to appropriately ‘deflate’ nominal GDP into real GDP.
So far, MoSPI has been using a combination of WPI and CPI to adjust GDP in current prices to compute the real GDP, although the new GDP series is expected to use the output PPI for once the new index is found to be stable and reliable. To be sure, the government has repeatedly said India’s WPI with 2011-12 as the base year is not too different from an output PPI.
While both WPI and output PPI are calculated using prices received by producers, the latter is seen as being more consistent with the national accounts framework and aligned with global best practices.
Finally, a Services Producer Price Index will also be released on June 15 for seven services: banking, securities transaction, management of pension funds, insurance, railways, air (passenger) and telecom. The services PPI will be on a quarterly basis and the first number will be for January-March 2026.
Like the WPI, all the three varieties of the PPI will have 2022-23 as the base year.
The commerce ministry, on June 15, will release the new Wholesale Price Index (WPI) series with 2022-23 as the base year, starting with data for May as well as a back-series from April 2023 onwards. However, this new year series will in all likelihood be discontinued after five years in 2031 and the Producer Price Index (PPI) based on output prices will become the main measure of non-retail inflation.
While inflation based on the Consumer Price Index (CPI) is the most widely considered measure of price increases in the country for households and used by the Reserve Bank of India (RBI) to decide interest rates, the WPI is crucial too and used in price escalation clauses in the supply of raw materials, machinery, and construction work.
For example, in long-term sales and purchase contracts, WPI inflation is used by companies as an indexing tool to adjust terms to account for changes in prices in the future. The Ministry of Finance’s Department of Expenditure will issue a circular on the same, Praveen Mahto, Principal Economic Adviser in the commerce ministry’s Department for Promotion of Industry and Internal Trade (DPIIT), said on Tuesday.
“The purpose of the circular would be to tell users of WPI that the government has decided we’ll be transitioning from WPI to PPI in a period of 5 years. So now, when you enter into any fresh contract which is of long-term nature and will go beyond 2031, then you have to start using PPI,” Mahto said. He did not specify when the Department of Expenditure will issue the aforementioned circular.
The new WPI series as well as the release of an output PPI continues the government’s overhaul of India’s official statistics.
Earlier this year, the Ministry of Statistics and Programme Implementation (MoSPI) not only updated the base years for CPI and GDP data but also improved the methods used to calculate these key economic indicators.
On Monday, MoSPI released its revised Index of Industrial Production (IIP) series, with 2022-23 as the base year. MoSPI is also working on the services sector counterpart of the IIP.
Along with the new WPI series, the commerce ministry will, on June 15, also release three different types of Producer Price Indices. These include the monthly output PPI – for May as well as a back-series starting from April 2023 – and a monthly input PPI for the manufacturing sector on an experimental basis starting with March. It is expected the input PPI trial will last for around a couple of years, during which time the quality of data is examined and feedback from the users of data and other stakeholders are discussed.
The output PPI helps measure the prices received by producers and excludes net tax as well as trade and transport margins. A year-on-year change in the output PPI will be the output PPI inflation. To begin with, the output PPI will contain 125 items. Once the WPI is discontinued, the items in the output PPI will be disaggregated and rise to around 1,500.
Meanwhile, input PPI measures the prices paid by producers to buy inputs, which includes trade and transport margin. PPIs also cover services, while the WPI basket only contains goods.
According to officials, while the output PPI is similar to the WPI, the input PPI is closer to CPI.
Economists and organisations such as the International Monetary Fund have repeatedly called on the government to develop PPIs to appropriately ‘deflate’ nominal GDP into real GDP.
So far, MoSPI has been using a combination of WPI and CPI to adjust GDP in current prices to compute the real GDP, although the new GDP series is expected to use the output PPI for once the new index is found to be stable and reliable. To be sure, the government has repeatedly said India’s WPI with 2011-12 as the base year is not too different from an output PPI.
While both WPI and output PPI are calculated using prices received by producers, the latter is seen as being more consistent with the national accounts framework and aligned with global best practices.
Finally, a Services Producer Price Index will also be released on June 15 for seven services: banking, securities transaction, management of pension funds, insurance, railways, air (passenger) and telecom. The services PPI will be on a quarterly basis and the first number will be for January-March 2026.
Like the WPI, all the three varieties of the PPI will have 2022-23 as the base year.
