India’s wholesale inflation eases to 2.05% in March, food inflation falls sharply to 1.57%

India’s wholesale price inflation eased slightly to 2.05% in March 2025, down from 2.38% recorded in February, according to fresh government data. While the overall trend indicates marginal relief, the annual comparison reflects a significant rise from 0.26% in March 2024, highlighting a growing pressure on wholesale costs.

The Industry Ministry attributed the positive inflation rate to increased prices in key sectors such as food product manufacturing, general manufacturing, food articles, electricity, and textiles. This combination of industrial and consumer-linked components continues to shape India’s wholesale price index (WPI).

A significant highlight of the report is the cooling of food inflation. It dropped to 1.57% in March from a much steeper 3.38% in February. This was largely driven by a sharp deflation in vegetable prices, which saw a fall of 15.88%—a steep drop compared to the 5.80% deflation in February.

However, not all sectors followed this cooling trend. Inflation in manufactured products rose to 3.07% in March, compared to 2.86% the previous month. This suggests continued cost pressures in the industrial sector, especially in goods like textiles and processed foods.

Fuel and power also registered a modest increase. After witnessing a deflation of 0.71% in February, inflation in this category turned slightly positive at 0.20% in March, reflecting mild pricing pressure in the energy supply chain.

Despite the easing headline number, the underlying shifts in sectoral inflation point to a mixed bag for policymakers. Cooling food prices may help control retail inflation, but upward trends in manufacturing and power could require closer monitoring in the months ahead.