What are the terms of reference of the working group constituted to for the revision of the current series of Wholesale Price Index?
The government has constituted a Working Group under the member of Niti Aayog Prof. Ramesh Chand for the revision of the current series of Wholesale Price Index (Base 2011-12).
Terms of Reference of the Working Group
- To suggest the most appropriate Base Year for the preparation of a new official series of Index Numbers of Wholesale Price (WPI) and Producer Price Index (PPI) in India.
- To review commodity basket of the current series of WPI and suggest additions / deletions of commodities in the light of structural changes in the economy witnessed since 2011-12.
- To review the existing system of price collection in particular for manufacturing sector and suggest changes for improvement.
- To decide on the computational methodology to be adopted for monthly WPI/PPI.
- To examine the existing methodology of compilation of PPI approved by Technical Advisory Committee on Series of Prices and Cost of Living and suggest further improvement in compilation and presentation. The Working Group may recommend roadmap for switch over from WPI to PPI.
- To examine the method of computing linking factor adopted so far and suggest appropriate change in method of computing linking factor, if necessary.
- To suggest any other improvements as may be necessary for enhancing the reliability of the official series of WPI / PPI.
Why there is a need for Revision?
- The current series of WPI with 2011-12 as base year was introduced in 2017. Since 2011-12, there has been a significant structural change in the economy of India.
- It is necessary to examine the coverage of commodities, weighting diagram and related issues pertaining to the existing series of index numbers of WPI.
Hence the working group has been constituted elect the most appropriate base year for the preparation of a new official series of index numbers of WPI and PPI in India and review the existing system of price collection in particular for manufacturing sector and suggest changes for improvement.