CPI base year to shift to 2024; food weight cut sharply in revamped inflation index: SBI Research 

India’s consumer inflation measurement is set for a major overhaul, with the base year of the Consumer Price Index (CPI) proposed to be revised to 2024 from the current 2012 series, according to an Ecowrap report by SBI Research, citing recommendations of an expert group constituted by the Ministry of Statistics and Programme Implementation (MoSPI). 

The revised CPI, with 2024=100 as the new base, aims to better reflect changing household consumption patterns, rising services usage and the growing role of digital platforms. The first release under the new CPI series is scheduled for February 12, 2026, along with a back series for rural, urban and combined indices from January 2013 onwards, the report said. 

One of the most significant changes is a sharp reduction in the weight of food and beverages, which falls to 36.75% from 45.86% in the current series. This adjustment reflects the declining share of food in household spending as incomes rise. At the same time, weights for transport, information and communication have increased to 12.41% from 8.59%, while recreation, sport and culture more than doubled to 4.86%, signalling a structural shift towards services-led consumption.

The revised CPI basket will consist of 358 weighted items, mapped across 12 divisions, 43 groups and 62 classes, in line with the COICOP 2018 classification, enhancing global comparability. The number of goods items will increase to 314, while services will expand from 40 to 50 items, reflecting broader coverage of modern consumption trends. 

A key feature of the new framework is the inclusion of e-commerce prices. The CPI 2024 series will collect weekly price data from 12 online markets in cities with populations exceeding 25 lakh, allowing inflation data to capture digital retail behaviour more accurately. 

Several methodological upgrades have also been proposed. The expert group recommended switching to the Jevons short index formula for elementary-level index calculation to improve quality adjustment and reduce dependence on base prices. Prices of centrally administered items such as fuel, rail fares and telecom services will be collected centrally, while electricity prices will be captured across four consumption slabs. 

For precious metals, the CPI will move away from pricing customised jewellery, instead tracking standardised gold and silver items such as bangles, rings and necklaces to ensure consistency. Employer-provided accommodation and free social transfers will be excluded from the index. 

SBI Research estimates that applying the new weights to unchanged price indices would result in headline CPI inflation rising marginally by 20–30 basis points on average, while during periods of elevated food inflation, headline CPI could be 20–30 basis points lower. This suggests the revised CPI may offer a more stable and representative inflation signal for policymakers and markets. 

The revamp is expected to improve the accuracy, credibility and policy relevance of India’s inflation data as consumption patterns continue to evolve rapidly.