India to Use Producer Price Index (PPI) for GDP Deflation
In July 2026, the Ministry of Statistics and Programme Implementation (MoSPI) announced its plan to use the output Producer Price Index (PPI) as a deflator for quarterly and annual GDP estimates. This change replaces the Wholesale Price Index (WPI) in relevant areas and aligns India's national accounts with international standards. The new methodology will be introduced with GDP estimates for April-June 2026-27.
🔑 Key Points
- •MoSPI to use output PPI for GDP deflation.
- •Replaces WPI in applicable instances.
- •Aligns India's national accounts with international standards.
- •PPI series released by DPIIT in June 2026.
- •New methodology starts with April-June 2026-27 GDP estimates.
🎯 Why It Matters for Your Exam
This is a significant change in economic statistics, highly relevant for banking, UPSC, and other competitive exams. Questions can cover the index change, its purpose, and the implications for GDP measurement.
🧠 Practice Question
Which index will India use as a deflator for quarterly and annual GDP estimates, replacing the Wholesale Price Index (WPI) where applicable?
- A.Consumer Price Index (CPI)
- B.Producer Price Index (PPI)
- C.Industrial Production Index (IIP)
- D.Services Price Index (SPI)
Show answer ▼▲
✅ Answer: B. Producer Price Index (PPI)
The Ministry of Statistics and Programme Implementation (MoSPI) announced plans to use the output Producer Price Index (PPI) as a deflator for GDP estimates.
Source: CIVILGYAN Current Affairs Desk
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