Govt to replace WPI with Producer Price Index, new series from June 15

📌 Summary:

• Government will phase out the Wholesale Price Index (WPI) over the next FIVE years
• Will simultaneously introduce a more detailed Producer Price Index (PPI) — covering output prices, input prices AND services prices
• Aim: a more realistic assessment of inflationary trends in the economy
• Revised WPI series with new base year 2022-23 will be released on June 15, 2026 — replacing the existing 2011-12 base series
• Released by: Department for Promotion of Industry and Internal Trade (DPIIT), Commerce & Industry Ministry
• Praveen Mahto, Principal Economic Adviser, made the announcement
• Significance: WPI does NOT cover services; PPI will fill that gap, aligning India with international best practice (most developed economies use PPI, not WPI)
• WPI currently measures price changes at the wholesale level for goods only; PPI will measure prices received by producers for output and prices paid for inputs/services

🎯 UPSC Relevance: GS3 — Indian Economy; inflation measurement, statistical reform. Useful for Mains questions on monetary policy transmission, inflation indices.

📝 Prelims Facts:

• WPI base year currently: 2011-12 (revised to 2022-23 on June 15, 2026)
• WPI released by: Office of the Economic Adviser, DPIIT (Ministry of Commerce & Industry) — NOT MoSPI
• CPI (Consumer Price Index) is released by NSO/MoSPI; CPI is the RBI's official inflation target
• PPI will cover output prices, input prices AND services prices
• Most developed economies (US, UK, EU, Japan) use PPI, not WPI
• Phase-out window: 5 years

🔑 Key Term: Producer Price Index (PPI) — measures the average change over time in the selling prices received by domestic producers for their output, plus input and services prices; gives a more comprehensive view of producer-side inflation than WPI (which excludes services).