Centre unveils new CPI series; Jan inflation at 2.75%
New Delhi: India on Thursday rolled out a revised Consumer Price Index series with base year 2024, replacing the 2012 base, in a move officials say will sharpen inflation measurement and improve policy inputs. The National Statistics Office under the Ministry of Statistics and Programme Implementation released the updated benchmark, which reflects shifts in consumption patterns over more than a decade and broadens the basket of goods and services used to track retail prices.
The new CPI reading for January stood at 2.75 per cent, according to official data. Coverage has been expanded to 358 items from 299, including 308 goods and 50 services. Price collection now spans 1,465 rural markets, 1,395 urban markets and 12 online marketplaces. The classification structure has also doubled from six to 12 groups to allow more detailed tracking of price movements.
Chief Economic Advisor V Anantha Nageswaran said the recalibrated index draws on findings from the Household Consumption Expenditure Survey 2023-24. “Since the CPI basket is now aligned with recent expenditure data, the inflation signals derived from this will be more closely matched with the economic conditions. This improves the information basis for calibrating monetary and fiscal policy,” he told reporters.
Weights assigned to major categories have shifted. Food and beverages now account for 36.75 per cent, down from 45.86 per cent in the earlier series, a change that could moderate overall volatility. Housing carries a 17.67 per cent weight and now includes utilities. Paan, tobacco and intoxicants rose to 2.99 per cent, while clothing and footwear declined to 2.38 per cent. Newly separated groups include furnishings and household maintenance at 4.47 per cent, health at 6.1 per cent, transport at 8.8 per cent, information and communication at 3.61 per cent, recreation, sports and culture at 1.52 per cent, education services at 3.33 per cent, restaurants and accommodation at 3.35 per cent, and personal care and miscellaneous goods and services at 5.04 per cent.
Nageswaran said the broader services coverage and inclusion of digital markets give policymakers a more current basis for assessing real incomes, purchasing power and consumption trends. He noted that a lower share for food, a category known for sharp price swings, may lead to steadier headline inflation. If volatility declines, he added, fiscal expenditure, dearness allowance adjustments and index-linked bonds tied to CPI could become more predictable.
Index values under the revised series are available from January 2025, making year-on-year comparisons possible from January 2026. A linking factor enables back calculation to 2013. The updated framework also aligns classification with the COICOP standard and removes obsolete products, improving comparability with global statistical practices.
