New Delhi: India’s wholesale inflation rose to 1.81% in January, up from 0.83% in December, marking the highest level in the past 10 months. The data was released by the Ministry of Commerce and Industry on Sunday. Earlier, wholesale inflation had stood at 2.05% in March 2025.
The rise was driven largely by an increase in prices of primary articles and manufactured products, while fuel and power prices continued to remain in negative territory.
Inflation in primary articles — which include essential daily-use items — climbed from 0.21% in December to 2.21% in January. The food index moved from (-)0.43% to 1.55%, reflecting higher prices of food items. However, wholesale inflation in fuel and power declined further from (-)2.31% to (-)4.01%. Inflation in manufactured products rose from 1.82% to 2.86% during the same period.
The Wholesale Price Index (WPI) is divided into three major components. Primary articles carry a weight of 22.62%, fuel and power account for 13.15%, and manufactured products have the highest weight at 64.23%. Primary articles are further divided into food articles such as cereals, wheat and vegetables; non-food articles including oilseeds; minerals; and crude petroleum.
Meanwhile, retail inflation based on the Consumer Price Index (CPI) also increased in January to 2.75%, compared to 1.33% in December. This marks an eight-month high. Previously, retail inflation had touched 2.82% in May 2025.
A sustained rise in wholesale inflation can adversely impact productive sectors, as manufacturers often pass on the higher input costs to consumers. The government can attempt to manage wholesale inflation primarily through tax measures. For instance, excise duty cuts on fuel have been used in the past to cushion the impact of rising crude oil prices, though such measures have limitations.
WPI gives higher weight to factory-related items such as metals, chemicals, plastic and rubber. In contrast, retail inflation reflects prices paid by consumers and includes a higher share of food (45.86%), housing (10.07%), fuel and other household items.
Inflation in India is measured in two ways — retail inflation through the Consumer Price Index (CPI), which tracks prices paid by consumers, and wholesale inflation through the Wholesale Price Index (WPI), which reflects prices charged in bulk transactions between businesses.
