Key Highlights
- The Wholesale Price Index (WPI) was overhauled with a 2022‑23 base year, expanding its basket from 697 to 957 items.
- New Producer Price Indices (OPPI, IPPI, Service PPIs) were launched to accompany the revised WPI.
- Methodological shifts include using Gross Value of Output for weights and adopting Targeted Mean Imputation for missing data.
- May 2026 WPI showed 9.68% YoY inflation, driven chiefly by a 30.33% surge in Fuel & Power.
- Linking factors are supplied to compare the legacy and new series, though caution is advised.
Detailed Insights
The Statistics Office replaced the 2011‑12 WPI series with a refreshed version anchored in the 2022‑23 fiscal year. The principal motive was to mirror the structural transformation of India’s economy—new sectors, emerging technologies, and a diversified energy mix have rendered the older basket obsolete. To ease the transition, both WPI and the newly introduced Producer Price Indices (PPIs) will be released concurrently for the next five years, aligning India with the measurement practices of advanced economies and IMF recommendations.
Key structural changes in the revised WPI include:
- Basket enlargement to 957 commodities, providing broader sectoral coverage.
- Inclusion of renewable electricity (solar and wind) and, for the first time, nuclear power.
- Re‑classification of crude petroleum and natural gas from Primary Articles to the Fuel & Power group, creating a more logical energy‑price tracking framework.
- Weighting now based on Gross Value of Output (GVO) rather than Net Traded Value, better reflecting domestic production significance.
Statistical refinements were also introduced. Elementary indices are now derived using the short‑term formulation method, and missing price observations are addressed through Targeted Mean Imputation, a technique considered more robust than the earlier carry‑forward approach.
The suite of PPIs comprises:
- Output Producer Price Index (OPPI): captures price changes received by producers for final goods and services.
- Trial Input Producer Price Index (IPPI): monitors cost variations of inputs purchased by manufacturers, currently on an experimental roll‑out.
- Service PPIs: covers seven core services—Banking, Securities Transactions, Insurance, Pension Fund Management, Railways, Air Passenger Transport, and Telecommunications.
May 2026 provisional data illustrate the inflationary landscape:
- Overall WPI rose 9.68% YoY (April 2026: 8.26%).
- Fuel & Power recorded the highest sectoral inflation at 30.33%.
- Food inflation accelerated to 4.49%.
- OPPI for all commodities increased to 109.6, with mining & quarrying leading at 122.3.
To aid historical analysis, linking factors (e.g., All Commodities = 1.53) are provided, but analysts must recognise the substantive basket and methodological revisions that limit direct comparability.