PPI vs WPI: India's new inflation index launches 15 June with 2022-23 base
Synopsis
India is replacing a goods-only inflation lens with something far more granular. From 15 June, the new Producer Price Index brings services into the frame — banking, telecom, railways, air travel — and tracks both what producers earn and what they pay. It's the biggest statistical overhaul in a decade, and it will reshape how India reads price pressure.
Key Takeaways
India will launch the Producer Price Indices (PPI) on 15 June , alongside a revised WPI with base year 2022-23 .
Output PPI measures prices producers receive (Basic Price); Input PPI tracks what they pay for raw materials (Purchaser's Price).
Services enter inflation measurement for the first time, with seven sectors in Phase 1: banking, securities, insurance, pension funds, railways, air passenger transport and telecom.
The framework aligns India with IMF -recommended global standards and reduces double counting seen in WPI.
Combined Output and Input PPI will let policymakers trace how input cost inflation moves through the supply chain.
India will roll out its new Producer Price Indices (PPI) on 15 June, marking the most significant overhaul of the country's inflation measurement framework in over a decade. The PPI series will be released alongside a revised Wholesale Price Index (WPI) with an updated base year of 2022-23, aligning India's statistical system with global standards followed by advanced economies.
What is Output PPI
Output PPI measures the prices producers receive when they sell their goods, captured at what is known as the 'Basic Price' — a figure that excludes net taxes and trade and transport margins. In effect, it tracks the price a manufacturer of steel, cement or packaged food pockets directly from the buyer, stripped of downstream add-ons.
What is Input PPI
Input PPI works in the opposite direction, tracking the prices producers pay for raw materials and intermediate inputs. Unlike Output PPI, it is based on the 'Purchaser's Price', which includes transportation costs and trade margins, and therefore captures the actual inflation businesses face on fuel, chemicals, machinery parts and packaging.
How PPI differs from WPI
WPI and Output PPI overlap in intent — both measure producer-side prices — but diverge sharply on methodology. The WPI draws its weights from Gross Value of Output (GVO) estimates in National Accounts at a broad sectoral level, while Output PPI uses a more granular weighting structure derived from Supply Tables.
The bigger divergence is between WPI and Input PPI. WPI is anchored to Basic Prices, whereas Input PPI uses Purchaser's Prices — giving a sharper read on the real cost squeeze faced by businesses on the ground.
Why the shift matters
The transition closely aligns India's inflation measurement with the National Accounts framework and follows international best practices recommended by the International Monetary Fund (IMF). Used together, Output PPI and Input PPI let economists trace how raw material inflation moves through the supply chain and ultimately into final product prices.
Notably, the new framework is also expected to reduce the problem of double counting inflation that can occur under WPI. This matters for policymakers calibrating monetary responses, and for businesses pricing contracts.
Services finally enter the index
In a structural break from the goods-only WPI, the PPI framework brings services into the inflation lens. The first phase of Services PPI will cover seven services — banking, securities transactions, insurance, pension fund management, railways, air passenger transport and telecom. More services are expected to be added in subsequent phases as data systems mature.
The 15 June launch will be watched closely by economists, the RBI and industry, as India tests whether a more granular, services-inclusive producer index can deliver a cleaner signal on underlying price pressures.
Point of View
India has been promising a producer price index — and getting one is genuinely overdue. The real test isn't the launch on 15 June; it's whether PPI ends up replacing WPI in policy discourse, or whether both run in parallel and confuse more than they clarify. The inclusion of services is the most consequential change here, because a services-blind inflation index in a services-led economy was always a structural mismatch. If the RBI and the Finance Ministry begin citing PPI in rate and fiscal decisions, this will be a meaningful upgrade; if not, it risks becoming another well-designed dataset that sits outside the room where decisions get made.
NationPress
19 Jul 2026
Frequently Asked Questions
When will India launch the new Producer Price Index (PPI)?
India will launch the new Producer Price Indices on 15 June, alongside a revised Wholesale Price Index with a new base year of 2022-23. The move follows more than a decade of preparation.
What is the difference between Output PPI and Input PPI?
Output PPI measures the prices producers receive for goods they sell, calculated at Basic Price excluding taxes and trade margins. Input PPI measures the prices producers pay for raw materials, calculated at Purchaser's Price, which includes transportation and trade margins.
How is PPI different from WPI?
WPI and Output PPI both track producer-side prices, but use different methodologies — WPI relies on Gross Value of Output weights, while PPI uses Supply Tables for a more granular structure. PPI also includes services, whereas WPI is restricted to goods.
Which services are included in the new PPI?
The first phase of Services PPI will cover seven sectors: banking, securities transactions, insurance, pension fund management, railways, air passenger transport and telecom services. More services are expected to be added as data availability improves.
Why is the shift from WPI to PPI important?
PPI aligns India's inflation measurement with IMF-recommended international best practices and the National Accounts framework. It also reduces the double counting issue seen in WPI and gives policymakers a clearer view of how producer-side cost pressures pass through the supply chain.
