Founded in March 1995 in Calcutta by members of the Marxist International Correspondence Circle (May 1990) in collaboration with the Bengali language journal Lal Pataka group (January 1983), having broken away from the Communist Party of India (Marxist) in 1982, the WSPI inaugurated on 1–3 March 1995 in the Students Hall, College Squire, Calcutta.

Adopting the Object and the Declaration of Principles as laid down in 1904 by the Socialist Party of Great Britain (SPGB) as the basis, the party appreciated the SPGB for its opposition to the world wars on grounds of class and description of Russia in 1918 as "state capitalist".

In common with other parties of the WSM, it was formed as a revolutionary party opposed to Leninism and seeking to win control of the state by parliamentary means in order to abolish it and establish socialism on a worldwide scale.

[1] This resulted in a split called the World Socialist Group who remained with the WSM.

However, the party applied to rejoin the WSM and was ratified by Executive Committee of the SPGB on 5 May 2014.