Wholesale inflation (WPI) in the country increased for the fifth consecutive month and reached 3.88 percent in March 2026. This is much higher than 2.13 percent in February and 2.25 percent in March last year. According to government data released on Wednesday, the main reason behind this rise is the sharp rise in prices in fuel, electricity and manufacturing sectors.
The Industry Ministry said in a statement that the main reason for the increase in inflation in March was the increase in the prices of crude petroleum and natural gas, basic metals, non-food articles and other manufacturing products.
Big jump in fuel and crude oil
According to WPI data, inflation in fuel and electricity category increased to 1.05 per cent in March from -3.78 per cent (decline) in February. Especially the inflation in crude oil reached 51.57 percent, which was -1.29 percent in February.
Manufacturing is expensive, but food and drink are slow
While on one hand many things have become expensive at the wholesale level, on the other hand there has been some relief in the matter of food and drink. The pace of increase in food prices slowed down from 2.19 percent in February to 1.90 percent in March. The inflation rate of vegetables has also decreased, which was 4.73 percent in February and came down to 1.45 percent in March.
However, retail inflation based on consumer price index has increased marginally. It increased to 3.4 percent in March, whereas it was 3.21 percent last month. This increase is mainly due to increase in prices of some selected food items. The Reserve Bank of India (RBI) keeps an eye on this retail inflation to decide interest rates. In view of this condition of the economy, RBI has not made any change in the interest rates in its monetary policy earlier this month.
- Food Articles Inflation: 1.90% (February: 2.19%)
- Inflation of vegetables: 1.45% (February: 4.73%)
Impact of West Asia crisis
The ongoing crisis in West Asia after the US-Israel attack on Iran has had a direct impact on global oil prices. Since February 28, crude oil prices have increased by more than 50 percent. Within a month prices rose from about $70 per barrel to $122 per barrel.
Government’s step: cut in excise duty
To reduce the impact of oil prices, the government on March 26 reduced excise duty on petrol and diesel by Rs 10 per liter, so that companies do not pass the burden of increased costs on consumers.
Retail inflation also increased, RBI kept the rates stable
According to earlier released data, retail inflation (CPI) increased to 3.4 percent in March, which was 3.21 percent in February. The Reserve Bank recently kept the interest rates unchanged in its bi-monthly monetary policy. The central bank decides policy rates mainly on the basis of retail inflation. Overall, the rise in fuel and crude oil prices has pushed up wholesale inflation, while food inflation has seen a slight moderation.