NEW DELHI, July 29 — The Ministry of Statistics and Programme Implementation has announced plans to use the Producer Price Index as the deflator for quarterly and annual GDP estimates, replacing the Wholesale Price Index wherever applicable, in a methodological shift aimed at bringing India's national accounts closer to international standards.
The PPI series itself was released by the Department for Promotion of Industry and Internal Trade in June, and its adoption comes alongside other changes to the GDP calculation methodology, including a shift in base year to 2022-23 from 2011-12 and the use of "double deflation," which adjusts output and input prices separately rather than applying a single deflator across the board. Officials say the earlier single-deflation method using WPI had been distorting growth estimates in certain quarters.
The change comes at a time when both WPI and PPI inflation have been running hot — WPI inflation touched 9.87 percent in June, up from 9.68 percent in May, while output PPI inflation rose to 9.57 percent from 9.38 percent over the same period. The new methodology is expected to be applied starting with GDP estimates for the April-June quarter of 2026-27, alongside a revised back series.
This is a dense but high-value topic for economics-focused sections — aspirants should note the shift from WPI to PPI, the new base year, and the term "double deflation."