January Consumer Price Index (CPI) stood at 2.75%, based on the new CPI series with 2024 as the base year. Inflation in rural areas came in at 2.73%, while urban inflation was slightly higher at 2.77%.
December inflation released on January 12 was at 1.33%, based on the old CPI series with 2012 as the base year.
Food inflation eased
Food inflation, measured by the Consumer Food Price Index (CFPI), eased to 2.13% in January. Housing inflation stood at 2.05%.
The new CPI series is based on the Household Consumption Expenditure Survey (HCES) 2023–24, which reflects changes in consumer behaviour over the past decade.
Several new-age items and services have been added to the consumption basket, including rural housing, online media services, value-added dairy products, exercise equipment, babysitter services, pen drives and external hard disks.
CPI basket expanded to 358 items
“An Expert Group on Base Revision of CPI was constituted with representation from the Reserve Bank of India, academia, line Ministries, and statistical experts,” Ministry of Statistics & Programme Implementation (MoSPI) said in the release.
Under the new series, the number of weighted items has increased from 299 to 358.
This expansion includes a sharp rise in both goods and services. The number of goods items has gone up from 259 to 308, while services items have increased from 40 to 50.
Rural house rent added, modern items gain weight
MoSPI highlighted that one of the key changes is the first-time inclusion of rural house rent, aimed at improving the measurement of housing consumption in rural areas. The revised basket also gives greater weight to modern consumption items such as online media services and cleaner fuels like CNG and PNG, reflecting evolving lifestyle choices.
The CPI 2024 series has also improved the use of digital and administrative data sources. This includes better coverage of telephone charges, rail and air fares, fuel prices, postal charges, and online media and streaming services, including OTT subscriptions.
The government said it has adopted the international COICOP 2018 framework for the new CPI series. This replaces the earlier structure of six broad consumption groups and aligns India’s inflation measurement with the latest standards set by the United Nations Statistics Division.
Under the revised classification, household expenditure is now organised into 12 divisions, 43 groups, 92 classes, 162 subclasses and 358 items at the lowest level. This allows items to be classified more precisely based on their actual usage, ensures global comparability of India’s CPI data, and enables more detailed and granular release of inflation indices and rates.
GDP, IIP base year revised to 2022–23
The government has also also revised the base year for GDP and IIP data to 2022–23. The GDP data under the revised base year will be released on February 27.