India introduces new inflation measurement system; January retail inflation at 2.75%

PTC Web Desk: The government has introduced a new method to measure inflation in the country. According to fresh data released by the National Statistics Office (NSO), retail inflation in January stood at 2.75 per cent under the revised calculation system.

The new series uses 2024 as the base year instead of 2012. With this revision, the government has expanded the number of items used to calculate inflation. The basket of goods has been increased from 259 to 308 items, while the number of services has gone up from 40 to 50. The aim is to provide a more accurate picture of price trends across the country.

Food inflation in January was recorded at 2.13 per cent under the new system.

The updated index now includes several new components that reflect changing consumption patterns. These include rural house rent, CNG and PNG prices, and online media services. Digital expenses such as mobile bills, railway and airfares, and subscription charges for OTT platforms have also been added to the inflation basket.

For comparison, under the old method based on 2012 as the base year, retail inflation for January 2025 was recorded at 4.26 per cent, while it stood at 1.33 per cent in December.

The revision is aimed at capturing the real cost of living more effectively by considering modern spending habits and new services used by households.