India January inflation: FAQs on what changed

India's annual retail inflation reached 2.75% in January, marking the inaugural reading under the newly revised Consumer Price Index (CPI) series with a base year of 2024, as reported by the Ministry of Statistics and Programme Implementation (MoSPI). This revision reflects an update in the CPI basket, incorporating data from the latest Household Consumption Expenditure Survey (HCES) for 2023-24, along with fresh market surveys and methodological enhancements. A significant change in the new CPI structure is the notable reduction of the weight assigned to food and beverages, which has dropped to 36.75% from 45.86% in the previous 2012 series. This adjustment aligns with updated consumption patterns and adheres to the United Nations’ 2018 Classification of Individual Consumption According to Purpose (COICOP) framework. Additionally, the overall number of weighted items in the basket has increased to 358, reflecting a more comprehensive approach to inflation measurement. The CPI 2024 series enhances data collection methods by utilizing tablet-based software for price collection across 1,465 rural and 1,395 urban markets, alongside online platforms for certain services. These updates are expected to provide a more accurate representation of inflation trends in the country, addressing the evolving economic landscape.