India unveils revised CPI basket; January inflation at 2.75 per cent in first reading with 2024 base as the country rolled out a revised Consumer Price Index (CPI) series with 2024 as the new base year, and the first reading under this updated framework places retail inflation at 2.75 per cent for January, data released by the Ministry of Statistics and Programme Implementation showed. The revision replaces the earlier 2012 base year, marking the first methodological overhaul in more than a decade.
The updated index reflects changing consumption behaviour across households. Notably, the weight assigned to food and beverages has been reduced to 36.75 per cent from 45.86 per cent, indicating that food now accounts for a smaller share of household expenditure as income levels rise. Meanwhile, housing weight has increased sharply to 17.66 per cent from 10.07 per cent, highlighting the growing importance of accommodation costs in household budgets. The combined weight of transport and information services has also moved higher to 12.41 per cent, compared with 8.59 per cent earlier.
Inflation trends for January remained relatively contained across segments. Food inflation stood at 2.13 per cent, while rural inflation came in at 2.73 per cent and urban inflation at 2.77 per cent. Housing inflation was recorded at 2.05 per cent for the month.
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To improve accuracy, the National Statistics Office expanded the basket of items used for calculation, increasing coverage from 259 to 308 goods and from 40 to 50 services. The revised basket introduces products and services that better mirror present-day consumption patterns, including rural housing, online media and streaming services, value-added dairy products, barley products, pen drives, external hard disks, and exercise equipment.
At the same time, items considered obsolete have been dropped from the index. These include VCR and DVD players, radios, tape recorders, second-hand clothing, and coir rope, signalling a shift toward a more contemporary representation of consumer spending.
The methodology has also been strengthened through the collection of weekly price data from 12 online markets, alongside administrative data for centrally regulated categories such as fuel, rail fares, and telecom services. The base year revision relies on findings from the Household Consumption Expenditure Survey 2023-24 and aligns with the Classification of Individual Consumption According to Purpose 2018 standards.
According to the Ministry, adopting the 2024 base year ensures that the CPI remains representative of current price structures, consumption patterns, and the evolving nature of the Indian economy.
