In a dynamic world, prices do not remain constant.
Inflation rate calculated on the basis of the movement of the Wholesale Price Index (WPI) is an important measure to monitor the dynamic movement of prices.
As WPI captures price movements in a most comprehensive way, it is widely used by Government, banks, industry and business circles.
Important monetary and fiscal policy changes are often linked to WPI movements.
Similarly, the movement of WPI serves as an important determinant, in formulation of trade, fiscal and other economic policies by the Government of India.
The WPI indices are also used for the purpose of escalation clauses in the supply of raw materials, machinery and construction work.
The Office of the Economic Adviser in the Department of Industrial Policy and Promotion, Ministry of Commerce & Industry is responsible for compiling WPI and releasing it.
The first index number of wholesale prices commenced in India for the week January 10, 1942. It was having the base week ending August 19, 1939 = 100 which was published by the office of the Economic Adviser to the Government of India (Ministry of Industry).
Since 1947 the index is being published regularly.
As the WPI with base 1993-94=100 was not adequately reflecting the current structure of the economy, the Ministry of Commerce and Industry, Department of Industrial Policy and Promotion, Government of India, constituted a Working Group for the revision of the WPI series on December 26, 2003 under the Chairmanship of Prof. Abhijit Sen, Member, Planning Commission.
Ever since the introduction of the Wholesale Price Index (WPI) on a regular basis, so far six revisions have taken place introducing the new base years, viz.,
 1952-53 (effective April 1956) (112 Commodities)
 1961-62 (effective July 1969) (139 Commodities)
 1970-71 (effective January 1977) (360 Commodities)
 1981-82 (effective January 1989) (447 Commodities)
 1993-94 (effective April 2000) (435 Commodities) and now
 2004-05 (effective August 2010) (676 Commodities)
The new WPI series with base 2004-05 has 676 items in the commodity basket, out of which 102 belong to ‘Primary Articles’ Group, 19 belong to ‘Fuel & Power’ Group and remaining 555 items belong to ‘Manufactured Product’ group.
On the other hand, there were total 435 items in the commodity basket of the WPI with base 1993-94, out of which, 98 were Primary Articles, 19 were Fuel and Power items and rest of the 318 items were Manufactured Products.
[a] the first set of data of WPI (for the Manufacturing Products) are released on monthly basis.
[b] the second set of data of WPI (for the ‘Primary Articles’ and ‘Energy and Fuel Group’ ) are released on the weekly basis.