Base year of WPI, IIP revised to 2011-12


Mosambi, pomegranate, jack fruit, pear, cucumber and carrot are the new fruits and vegetables added to calculate wholesale inflation (WPI) in country as the government on Friday revised inflation and industrial growth (IIP) base year to make it more relevant to the changing times.

According to the new series data released today, wholesale inflation in food articles was 1.16 per cent in April, lower than 3.82 per cent in March.

India's factory output or Index of Industrial Production (IIP) grew 2.7% in the month of March 2017 as against a drop of 1.2% in February 2017.

The consumer price index (CPI) based retail inflation for March 2017 was revised slightly upwards to 3.89 per cent, from 3.81 per cent recorded previously.

IIP in the new series will continue to consist of three sectors viz. For capital goods, data in the new series will now be captured in terms of "work in progress" to better represent the growth of capital goods and to avoid reporting of production figures in bulk after the completion of production.

The CSO has added 149 new items such as steroids and hormonal preparations, cement clinkers, surgical accessories, prefabricated concrete blocks and refined palm oil while 124 products such as calculators, colour TV picture tubes and gutka have been deleted from the 2004-05 series, which had 620 items.

He said certain items which were in the old series are present in the new series as well, but are appropriately reclassified either by splitting up old items or combining them.

"Build up inflation rate in the financial year so far was -0.18% compared to a build up rate of 1.21% in the corresponding period of the previous year", it said.

The mining sector, however, expanded by 9.7 per cent in March 2017 compared to a growth of 4.7 per cent in the year- ago month. This, also, is mainly due to the fact that the IIP is only a volume indicator, while the GVA captures value addition as well.While manufacturing GVA is forecast to have grown 7.7% in 2016-17, the IIP data show the production in the sector has actually contracted by 0.3% in the first 11 months of the last fiscal.

The main change made to the WPI and IIP is that the base year has been shifted from 2004-05 to 2011-12 in order to make the data more contemporary and reflective of ground realities.

The WPI and IIP data based on new series were not statistically comparable with the earlier data based on 2004-05 base year, T.C.A. Anant, India's chief statistician, told reporters.