Govt approves new WPI series, producer price indices to be launched on June 15

The government has approved the revision of the base year for the Wholesale Price Index (WPI) from 2011-12 to 2022-23 and the introduction of a comprehensive Producer Price Index (PPI) framework, marking a key overhaul of India's producer inflation measurement system. 

The Office of the Economic Adviser under the Department for Promotion of Industry and Internal Trade (DPIIT) will release the revised WPI series with the new base year of 2022-23 on June 15, 2026, replacing the existing 2011-12 series. 

Alongside the revised WPI, the government will also introduce a new Output Producer Price Index (OPPI), a Trial Input Producer Price Index (IPPI), and Service Producer Price Indices for seven sectors — banking, securities transactions, insurance, pension fund management, railways, air passenger transport, and telecommunications. 

Transition from WPI to PPI 

According to the government, the WPI will continue to be published for five years alongside the newly introduced PPIs to allow users adequate time to transition. Thereafter, the WPI will be discontinued. 

The move aligns India with international best practices followed by advanced economies and recommendations of the International Monetary Fund, which favour producer price indices as a more comprehensive measure of inflation faced by businesses. 

Officials said the simultaneous availability of Output PPI and Input PPI will provide deeper insights into how changes in input costs are transmitted to output prices across industries, offering a more accurate assessment of producer inflation dynamics. 

The Service PPI has been introduced in phases, beginning with seven services where reliable administrative data are available. Additional services will be incorporated in future as data availability improves. 

Data availability 

The revised WPI and Output PPI will be published monthly. The first release, scheduled for June 15, will include provisional data for May 2026 along with a back series covering April 2023 to April 2026. 

The Trial Input PPI, currently limited to the manufacturing sector, will be released on an experimental basis from March 2026 onwards to facilitate stakeholder feedback and assess data quality. 

Meanwhile, the Service PPI will be released on a quarterly basis, with the first publication covering the fourth quarter of FY26 along with historical data from the first quarter of FY24 through the third quarter of FY26. 

Key changes in new WPI series 

The revised WPI incorporates several structural and methodological improvements aimed at making the index more representative of India's evolving economy. 

Expanded commodity basket: The number of items covered under the index has increased sharply to 957 from 697 in the existing series. 

Inclusion of renewable energy: Solar, wind, and nuclear power have been added to the electricity basket, reflecting the growing importance of clean energy in India's power mix. 

Reclassification of energy commodities: Crude petroleum and natural gas have been shifted from the "Primary Articles" category to the "Fuel and Power" group, creating a more coherent framework for tracking energy prices alongside coal, electricity and petroleum products. 

Improved weighting methodology: The revised series uses Gross Value of Output (GVO) to determine commodity weights, replacing the earlier methodology based on net traded value. According to officials, GVO better captures the economic significance of commodities from a producer's perspective as it reflects domestic production. 

Enhanced index computation: The new series adopts a chain-based short-term formulation for calculating elementary indices, replacing the long-term formulation used in the previous series. 

Better handling of missing data: The revised methodology introduces a "Targeted Mean Imputation" approach for estimating missing prices, replacing the carry-forward method used earlier. 

Linking factor introduced: To ensure continuity between the old and new series, a linking factor has been computed using the ratio of geometric means of the 12-month average indices for FY25. The factor will be available for all commodities and major groups. 

PPI framework based on National Accounts data 

The weights for Output PPI and Input PPI have been derived from the Supply and Use Tables of the National Accounts for 2022-23. While the WPI, Output PPI, and Service PPI will be compiled using basic prices, which exclude net taxes and trade and transport margins, the Input PPI will be based on purchasers' prices since it reflects the actual prices paid by industries for inputs.