WPI inflation hits record 12.94% in May; diesel too crosses Rs 100 in Rajasthan’s Sri Ganganagar
India’s wholesale-price inflation accelerated last month to the fastest pace in more than two decades, reflecting a surge in local fuel prices and the “low-base effect” of a drop in prices a year earlier.
The Wholesale Price Index (WPI) rose 12.94% in May from the same period of 2020, beating April’s 10.49%, according to government data published Monday. That’s the highest level since 1998, according to the data provider tradingeconomics.com.
The Wholesale Price Index (WPI) reflects changes in the average prices of goods at the wholesale level — that is, commodities sold in bulk and traded between businesses or entities rather than goods bought by consumers.
“The high rate of inflation in May 2021 is primarily due to low base effect and rise in prices of crude petroleum, mineral oils viz. petrol, diesel, naphtha, furnace oil etc. and manufactured products as compared the corresponding month of the previous year,” the nation’s commerce and industry ministry said in a statement.
Fuel price increase
Sri Ganganagar, a small city in northernmost part of Rajasthan near the India-Pakistan border has become the first city in the country where retail prices of both auto fuels — petrol and diesel — have crossed the century mark.
The city already had the distinction of having the highest pump price of petrol across the country at Rs 107.23 a litre. With diesel prices now increasing there by another 25 paisa per litre on Saturday it reached Rs 100.06 a litre.
However, the record may not be held for long as elsewhere in Rajasthan as well, especially towns near the border areas, diesel is expected to touch the Rs 100-mark soon.
Similarly, a few places in Madhya Pradesh, Maharashtra, Telangana and Andhra Pradesh, where by virtue of higher VAT rates, fuel prices are always much higher than rest of the country. Premium fuels have already been above the Rs 100-mark in several cities for past few months.
What had brought fuel prices closer to Rs 100-per-litre-mark is the consistent increase in retail prices done by oil marketing companies for last five to six weeks.
Even on Saturday, OMCs raised the price of petrol and diesel by 22-32 paisa per litre across the country, the second consecutive increase in as many days.
With the latest increase, the retail prices of petrol and diesel increased by 27 paisa per litre and 23 paisa per litre to touch Rs 96.12 and Rs 86.98 per litre, respectively in Delhi.
In Mumbai, where petrol prices crossed Rs 100-mark for the first time ever on May 29, the fuel price reached new high of Rs 102.36 per litre on Saturday. Diesel prices also increased in the city to reach Rs 94.45 a litre, the highest among metros.
Across the country as well petrol and diesel prices increased on Saturday but its retail prices varied depending on the level of local taxes in different states.
With Saturday’s price hike, fuel prices have now increased on 23 days and remained unchanged on 20 days since May 1. The 22 increases has taken up petrol prices by Rs 5.72 per litre in Delhi. Similarly, diesel have increased by Rs 6.26 per litre in the national capital.