WPI base year shifts to 2022-23

India revises its Wholesale Price Index to a 2022-23 base and begins phasing in Producer Price Indices that will eventually replace it.

What happened

• The Ministry of Commerce & Industry announced that the base year of the Wholesale Price Index (WPI) is being moved from 2011-12 to 2022-23, and that India will begin compiling a new family of Producer Price Indices (PPIs).
• The revision and the new PPIs were approved by the competent authority on 25 May 2026, after the compilation methodology was cleared by the Technical Advisory Committee (TAC) on Statistics of Price and Cost of Living and then placed before the National Statistical Commission (NSC).
• The Office of the Economic Adviser, DPIIT will release the revised WPI (2022-23) on 15 June 2026 at 12 noon, replacing the old 2011-12 series, alongside the first PPI releases.
• Three PPIs debut: an Output PPI (OPPI), a Trial Input PPI (IPPI), and a Service PPI covering seven services — Banking, Securities Transaction, Insurance, Management of Pension Funds, Railways, Air (Passenger) and Telecom.
• The old WPI does not vanish at once: because WPI is written into countless price-escalation clauses in contracts, it will keep running for five more years before being discontinued, giving users time to switch to PPI.
• The shift is described as aligning India with global best practice in advanced economies and the recommendations of the International Monetary Fund (IMF), which favour producer price indices over wholesale price indices.
• The first releases carry back series so the new numbers are usable immediately: WPI and Output PPI come with data from April 2023 to April 2026 (37 months), while the quarterly Service PPI is released for Q4 of 2025-26 with a back series running from Q1 of 2023-24.

For Prelims

• What WPI is: the Wholesale Price Index measures the average change in prices of goods at the wholesale / producer level — the first point of bulk sale — not at the retail counter. It is compiled by the Office of the Economic Adviser, DPIIT, under the Ministry of Commerce & Industry.
• Methodology family: WPI is a Laspeyres-type fixed-weight index — current prices are compared with base-year prices using base-year weights — which is exactly why the base year and the weighting scheme must periodically be refreshed. Elementary indices are built from geometric means of price relatives and then aggregated with these weights.
• Why a base-year revision matters: as production and consumption patterns change, base-year weights drift out of date and the index measures the wrong basket. Moving the base to 2022-23 keeps WPI representative of today's economy — the same reason CPI and the Index of Industrial Production are periodically rebased.
• Base year change: 2011-12 → 2022-23. A newer base captures the current structure of the economy and recent consumption-production patterns, so the index stays representative.
• Coverage expanded: the number of items rises from 697 to 957, widening the basket that the index tracks.
• Three major groups (structure of WPI): Primary Articles, Fuel & Power, and Manufactured Products. In the existing series Manufactured Products carry the largest weight, followed by Primary Articles and then Fuel & Power.
• Renewable energy enters the basket: Solar and Wind are added under the Electricity group, and Nuclear Electricity is included for the first time — so the index now reflects India's changing energy mix.
• Energy items reorganised: Crude Petroleum and Natural Gas move from Primary Articles into Fuel & Power, where coal, electricity and petroleum products already sit — a more coherent energy block.
• New weighting basis: weights now come from Gross Value of Output (GVO) instead of Net Traded Value (GVO + Imports − Exports). GVO is said to reflect domestic production and the producer's perspective better.
• New computation method: elementary indices now use a short-term, chain-based method instead of the long-term formulation, and missing prices are filled by Targeted Mean Imputation rather than the old carry-forward method.
• Linking factor: to splice old and new series, a linking factor is computed as the ratio of geometric means of the twelve monthly indices of the old and new series for 2024-25, available for All Commodities and the major groups.
• The PPI family — the headline reform: a Producer Price Index measures the average change in selling prices received by domestic producers. India is launching Output PPI (prices of goods produced), Input PPI (prices of inputs an industry buys, trial stage, manufacturing only) and Service PPI (prices of services).
• Why both Output and Input PPI matter: together they show how inflation on inputs is passed through into the prices of finished output — the producer's cost-to-price chain.
• Pricing basis (a fine but examinable point): WPI, Output PPI and Service PPI are compiled on Basic Price (excludes net taxes and trade-and-transport margins), while Input PPI uses Purchaser's Price, since industries buy inputs from the market.
• Release cadence: WPI and Output PPI are monthly; Service PPI is quarterly; the Trial Input PPI for manufacturing runs on an experimental basis from March 2026. Back series go back to April 2023 (37 months) for WPI/Output PPI.
• Sunset clause: WPI runs for five more years alongside PPI and is then discontinued — a phase-out toward replacement by PPI around 2031.
• A related index — CPI: the Consumer Price Index measures retail inflation faced by consumers and is compiled by the National Statistical Office (NSO) under the Ministry of Statistics and Programme Implementation. Unlike WPI, CPI includes services (housing, education, health). CPI — not WPI — is the inflation measure the RBI targets.
• RBI's anchor (a classic Prelims trap): under the flexible inflation-targeting framework, the RBI's Monetary Policy Committee targets CPI (headline) inflation at 4% within a ±2% band. WPI is not the RBI's policy target.
• Revision history: Indian WPI has been revised several times over the decades; the 2011-12 series (the one now retiring) became effective from April 2017, and the move to 2022-23 is the latest revision.
• One related index — IIP: the Index of Industrial Production, which tracks the volume of industrial output across Mining, Manufacturing and Electricity, was also last rebased to 2011-12 (effective May 2017). WPI, CPI and IIP together form the core of India's high-frequency macro-statistics, and base-year revisions of all three keep the macro picture honest.
• Why the seven services were chosen first: the Service PPI starts with Banking, Securities Transaction, Insurance, Pension-Fund Management, Railways, Air (Passenger) and Telecom because administrative data for these is already available; more services will be added in later phases as data sources mature.

For Mains