all India Wholesale Price Index (WPI)



  • Major Groups of WPI: Fuel & Power (Weight 13.15%), Primary Articles (Weight 22.62%)


  • WPI Food Index (Weight 24.38%): The Food Index consisting of 'Food Articles' from Primary Articles group and 'Food Product' from Manufactured Products group


  • WPI captures the average movement of wholesale prices of goods and is primarily used as a GDP deflator. WPI(2011-12) reckons only basic prices and does not include taxes, rebate/trade discounts, transport and other charges.


  • The DPIIT released index numbers of wholesale price in India on monthly basis on 14th of every month (or next working day) with a time lag of two weeks of the reference month, and the index numbers is compiled with data received from institutional sources and selected manufacturing units across the country.


  • This press release contains WPI (Base Year 2011-12=100) for the month of October, 2022 (Provisional), August, 2022 (Final) and other months/years. Provisional figures of WPI is finalised after 10 weeks, and then frozen thereafter.


  • The prices tracked are ex- factory price for manufactured products, agri-market (mandi) price for agricultural commodities and ex-mines prices for minerals. Weights given to each commodity covered in the WPI basket is based on the value of production adjusted for net imports. WPI basket does not cover services.


  • A significant change in the new series of WPI has been the exclusion of indirect taxes while compiling indices of manufactured products.


  • The Working Group for revision of WPI had recommended that taxes should not figure in this measure so that price signals emerging from production side of the economy are not influenced by the fiscal policy.


WPI and consumer price index (CPI)



  • WPI reflects the change in average prices for bulk sale of commodities at the first stage of transaction while CPI reflects the average change in prices at retail level paid by the consumer.


  • Major difference is the underlying data used for the derivation of weights of the items retained in the two index baskets.


  • The weights of the WPI are based on production values whereas the weights of the CPI basket are based on the average household expenditure taken from the Consumer expenditure survey conducted in the base year The prices used for compilation of WPI are collected at ex-factory level for manufactured products, at ex-mine level for mineral products and mandi level for agricultural products.


  • In contrast, retail prices applicable to consumers and collected from various markets are used to compile CPI.The CPI basket consists of services like housing, education, medical care, recreation etc. which are not part of WPI basket.




  • The main uses of WPI are the following:


  • Provides estimates of inflation at the wholesale transactions level for the economy as a whole. This helps in timely intervention by the Government to check inflation, in particular inflation in essential commodities, before the price increase spills over to retail prices. 18


  • WPI is used as deflator for many sectors of the economy for estimating GDP by CSO. It is also used to deflate nominal values of production in high frequency IIP.


  • WPI is also used for indexation by users in business contracts.


  • Global investors also track WPI as one of the key macro indicators for their investment decisions


What is Producer Price Index (PPI)?



  • Ans. Producer Price Index (PPI) measures the average change in the price of goods and services either as they leave the place of production, called output PPI or as they enter the production process, called input PPI.


  • How is PPI different from WPI?


  • Ans. PPI is different from WPI on following grounds:


  • WPI captures the price changes at the point of bulk transactions and may include some taxes levied and distribution costs up to the stage of wholesale transactions. PPI measures the average change in prices received by the producer and excludes indirect taxes.


  • Weights of items in WPI are based on net traded value whereas in PPI weights are derived from Supply Use Table.


  • PPI removes the multiple counting biases inherent in WPI. PPIs can be compiled separately for Out PPIs, Input PPIs and Export and Import PPIs. In build Stage of Processing indices can be compiles to avoid multiple counting.


  • WPI does not cover services and whereas PPI includes services.


  • How is PPI different from Consumer Price Index (CPI)? Ans. PPI is different from CPI on following grounds:


  • PPI estimates the change in average prices that a producer receives while CPI measures the change in average prices that a consumer pays. The prices received by the producers differ from the prices paid by the consumers on account of various factors such as taxes, trade and transport margin, distribution cost etc..


  • Weights of items in CPI are derived from Consumer Expenditure Surveys whereas for PPI it is calculated on the basis of Supply Use Table.


  • CPI based inflation estimates are used as nominal anchor for Monetary Policy formulation in general, whereas PPI estimates are used as deflators and for indexation of contracts etc


What is the composition and Terms of Reference of Technical Review Committee (TRC)?



  • Economies undergo structural changes over time.


  • Products and their specification both in terms of quality and technology are changing even faster. This makes it increasingly difficult to obtain the price information of selected products for a fixed number of quotations over a longer period of time.


  • Further an implicit disadvantage of Laspeyre’s formula used for compiling the WPI is that the indices with fixed weighting diagram fail to capture the dynamic changes in product mix and structure of the economy over time.


Technical Review Committee (TRC) chaired by Secretary, Department of Industrial Policy & Promotion



  • In order to address important technical issues such as substitution of source of data, change in specification of products and other data/methodological issues which require continuous process of review on a dynamic basis so that the new WPI series remains relevant during the life of the series, an institutional mechanism has been established through creation of Technical Review Committee (TRC) chaired by Secretary, Department of Industrial Policy & Promotion.


  • The composition of TRC is as follows:


  • 1. Secretary, D/o Industrial Policy and Promotion (DIPP) Chairman


  • 2. Secretary, M/o Statistics and Programme Implementation Member


  • 3. Chief Economic Adviser, Ministry of Finance Member


  • 4. Principal Economic Adviser, DIPP Member


  • 5. Economic Adviser, DIPP Member Secretary


The function of TRC will be as follows:



  • Reviewing periodically the list of products in the item basket of WPI and suggesting methodology for inclusion of new important items in and exclusion of outdated items from the existing basket as and when warranted


  • Reviewing periodically the panel of factories for compilation of WPI and suggest methodology for including new representative units that emerged after the roll out of the series in the existing panel, along with suggesting adjustment of the back series.


  • The Committee will also consider cases of closed units during the currency of the base year and recommend the methodology for replacing such units by new ones.


  • Reviewing periodically the items in the item basket that exhibit extraordinarily high increase/ decline in index during the currency of a fixed base year and propose normalization methodology.


  • Suggest methodology for adjusting prices of items with frequently changing specification.


  • Recommending appropriate methodological intervention to improve coverage, quality and timeliness of the WPI.


What are the Term of References of the Working Group for the revision of the current series of Wholesale Price Index?



  • The Terms of Reference of the Working Group are as follows:-


  • To select the most appropriate Base Year for the preparation of a new official series of Index Numbers of Wholesale Price (WPI), Producers Price Index (PPI) and Business Service Price Index (BSPI) in India.


  • To review commodity basket of the current series of WPI, PPI and BSPI and suggest additions/ deletions of commodities in the light of structural changes in the economy witnessed since 2004-05.


  • To evolve a suitable system for allocation weight to the various commodities to be included in the WPI/ PPI/BSPI basket.


  • To decide the computational methodology to be adopted for Monthly WPI/ PPI.


  • To suggest methods for ensuring smooth flow of data and also to look into the possibility of having a single agency for collecting data for Wholesale Price Index (WPI) and Index of Industrial Production (IIP).


  • To suggest any other improvements as may be necessary for enhancing the reliability of the official series of WPI/PPI/BSPI.


What Sub-Groups were formed under the Working Group for the revision of the Wholesale Price Index?



  • Ans. The following Sub Groups were formed under the Working Group for revision of Wholesale Price Index:


  • The Subgroup on analytical, conceptual, and computerization related issues


  • The Subgroup on Agricultural Commodities


  • The Subgroup on Mining, Fuel and Power


  • The Subgroup on manufacturing items basket (organized and unorganized)


  • The Subgroup on Producer Price Index