• The Office of the Economic Adviser to the Government of India, Ministry of Commerce & Industry, is introducing with effect from 1^st April 2000, the revised series of the Index of Wholesale Prices in India (Base 1993-94=100) in replacement of the earlier WPI series (Base 1981-82=100)

• A Working Group was set up by the Government under the Chairmanship of Prof. S.R. Hashim, the then Member, Planning Commission, for the revision of the Wholesale Price Index of India. Based on the recommendations of the Working Group the Government of India have decided to replace the existing series of Index Numbers of Wholesale Prices (Base: 1981-82) with a revised series having 1993-94 as the base year.

• The revised series (1993-94) has 435 items for which there are 1918 quotations. All items having large transactions in the economy have been included in the revised series to the extent feasible. Thus the revised series will have a substantially updated and representative basket of commodities as well as their varieties/grades and markets.

• The coverage of the new series has been rationalised by incorporating important new items, dropping unimportant items and amalgamating items with those to which they are akin.

• 136 distinctly new items have been added to the basket of the revised series, while 150 items have been dropped from the existing series. Thus 68% of the items/commodities are common in the existing and revised series.

• Some of the important items that enter the WPI commodities basket for the first time are Electricity for Railway Traction, Purified Terephthalic Acid(PTA), Injection Moulded Plastic Items, Oxygen Gas in Cylinder, Railway Sleepers (Cement product), Thinner, MS/SS Ingots, Cold Rolled Sheets, LPG Cylinder, Jelly Filled Telephone Cables, Colour TV Sets, Computer and Computer based Systems.

• Some of the dropped items are Mica, Imported Petroleum Crude, Indigenous Petroleum Crude, Khadi, Handloom Cloth, Broad Gauge open Wagons, Wrist Watches

• The following table gives comparative details of the coverage of the existing and revised series :-

TABLE - 1

• The following table presents a comparative picture of the weighting diagrams of the revised and the existing series:

										TABLE- II

• It may be observed from the (Table-II) that the weight of primary articles in the revised series has declined steeply, whereas that of ‘Fuel, Power, Light & Lubricants’ and ‘Manufactured products’ have increased significantly. This is a reflection of the structural change in the economy since 1981-82. As the weight of the ‘Manufactured Products’ and `Fuel, Power, Light & Lubricants’ have increased in relation to the existing series, any general upward movement in their prices (other things remaining constant) will have greater impact on the all commodity index and inflation rate compared to its impact in the 1981-82 series.

• A comparison of the indices of the revised series with the existing series, shifted to 1993-94 base, shows that the general behavior of the two series is fairly similar despite differences in the weighting diagram and commodity coverage.

• A comparison of the indices for the two series is given in the table-III below :-

• The revised series has been released for the week ending 1^st April, 2000.

• The Report of the Working Group on the Revision of Index Numbers of Wholesale Prices in India, is also available on the website.

Office of the Economic Adviser, Ministry of Commerce & Industry
New Delhi, dated; the 16^th April, 2000