Dr. R. S. Musale

ABSTRACT

To calculate inflation, the inflation-computing agency collects the prices of identified commodities. The agency can take into account wholesale prices, retail prices or factory-gate prices. As wholesale markets are few in number, it is easier to collect the prices of goods traded there. The Wholesale Price Index (WPI) takes into account the wholesale prices of over 400 commodities. The base year for the present WPI index, which is computed by the ministry of commerce and industry, is 1993-94. The 100-point index is subdivided into three groups. The primary articles, which include food and non-food agriculture products, have a weight of 22.02% in the index. Manufactured goods have the highest weight of 63.75%. Fuel and power account for 14.23%. The government is now ready with a revised index with a new base year.