Wholesale Price Index Current Affairs - 2019

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Government to constitute working group for revision of Wholesale Price Index

Central Government has constituted Working Group for the revision of the current series of Wholesale Price Index (Base 2011-12). It will be chaired by Prof. Ramesh Chand, Member, NITI Aayog. Office of Economic Adviser, Department for Promotion of Industry & Internal Trade will be nodal office for Working Group. It will process report / recommendation of this Working Group for further necessary action.

Terms of Reference of the Working Group are:

  • It will select most appropriate Base Year for preparation of new official series Wholesale Price Index (WPI) and Producer Price Index (PPI) in India.
  • It will review existing commodity basket of current series of WPI and suggest additions and deletions of commodities in light of structural changes witnessed in economy since 2011-12.
  • It will also review existing price collection system for manufacturing sector and suggest changes for improvement. It will also decide on computational methodology to be adopted for monthly WPI/PPI.
  • It will examine existing Technical Advisory Committee on Series of Prices and Cost of Living approved compilation methodology of PPI approved and suggest further improvement in compilation and presentation.
  • It may also recommend roadmap for switch over from WPI to PPI. It will also examine method of computing linking factor adopted so far and suggest appropriate changes in method of computing linking factor.
  • It will suggest any other improvements as may be necessary for enhancing reliability of the official series of WPI / PPI.

Background

The current series of Wholesale Price Index (WPI) with 2011-12 as base year was introduced by Government in May 2017.  However, since 2011-12, significant structural changes have taken place in the economy. Therefore considering these factors it has become necessary to examine coverage of commodities, their weighting diagram and related issues pertaining to existing series of index numbers of WPI.

Wholesale Inflation increases in February

The Wholesale Price Index is released by the Office of Economic Advisor (OEA), Department of Industrial Policy and Promotion, Ministry of Commerce and Industry.

Wholesale Price Index February 2019

  • Inflation based on wholesale prices rose to 2.93% in February over January 2019 due to hardening of prices of primary articles, fuel and power.
  • Wholesale Price Index (WPI) based inflation stood at 2.76% in January 2019 and it was 2.74% during February 2018.
  • Inflation of primary articles, which includes kitchen essentials like potato, onion, fruits, and milk increased to 4.84 per cent during the month, as against 3.54 in January.
  • Wholesale-based price inflation for ‘fuel and power’ segment increased to 2.23 per cent in February as against 1.85 per cent in January 2019.

The Base year for the calculation of the Wholesale Price Index is 2011-12. In the WPI index, Primary Articles had a weightage of 22.62 per cent, Fuel and Power had a weightage of 13.15 per cent and Manufactured Products had a weightage of 64.23%.