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Government to replace WPI with a Producer Price Index

Monday, 15 June 2026· 5 min read·Source: The Hindu

The government announced the introduction of a Producer Price Index (PPI) for goods and services, beginning a shift away from the decades-old Wholesale Price Index (WPI), with the new series rolled out from June 15, 2026 and WPI to be replaced over about five years. A PPI measures the average change in selling prices received by domestic producers for their output, and—unlike WPI—can cover services, aligning India with international statistical practice followed by most major economies. The revamped framework is intended to give a more accurate, broader picture of price changes at the production stage.

Key Facts & Details

8 points

1
India introduced a Producer Price Index (PPI) for goods and services.
2
The new series was rolled out from June 15, 2026.
3
The WPI is to be replaced over about five years.
4
PPI measures prices received by producers, and can include services (WPI cannot).
5
The shift aligns India with global statistical practice.

Deep Dive

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WPI captures only goods at the wholesale stage; PPI captures producers' output prices across goods and services.
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Most advanced economies use PPI rather than WPI as their producer-price gauge.
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The change is led by the Office of the Economic Adviser under DPIIT.

Exam Focus

Which index is India introducing to eventually replace the Wholesale Price Index?

Exam Relevance & Angle

A major change in India's price-statistics framework is high-value economy GA, tested on the new index's name, what it measures and how it differs from WPI.

Target Exams

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Background & Context

A Producer Price Index (PPI) measures the average change over time in the selling prices received by domestic producers of goods and services — a 'first-point-of-sale' producer gauge. India has long used the Wholesale Price Index (WPI), which only covers goods at the wholesale level and excludes services. The move to PPI, recommended by expert committees over the years, brings India in line with the United States, China and other major economies that publish a PPI. The Office of the Economic Adviser under DPIIT compiles these producer-side indices, while retail inflation (CPI) is compiled by the National Statistical Office (NSO).