New Inflation Series & CPI Base Year Revision: CPI 2024=100 Recasts India’s Retail Inflation
India has introduced a revised Consumer Price Index (CPI) series with base year 2024=100, replacing the decade-old 2012 base to better reflect today’s consumption patterns. Released by NSO, MoSPI on 12 February 2026, the new series updates weights using the Household Consumption Expenditure Survey (HCES) 2023–24 and expands the basket to include modern services such as OTT subscriptions and e-commerce pricing.
What changed and why it matters
A CPI base revision is not just a “year change”—it updates what Indians buy, how much they spend on each category, and where prices are captured from. MoSPI explains that India’s consumption behaviour has seen structural shifts over the last decade due to rising incomes, urbanisation, expansion of services, and digitalisation—making a base update necessary for representativeness.
This revised CPI series is also built on international classification standards (COICOP 2018), which improves comparability and gives more granular inflation break-ups.
1) Food weight reduced sharply: 45.86% → 36.75%
The biggest headline change is the fall in Food & Beverages weight. Under the new CPI 2024 structure, Food & Beverages now carry a 36.75% weight (combined), compared to the older CPI 2012 structure where the group “Food and Beverages” had 45.86% weight.
MoSPI clarifies an important technical point: if the old 2012 classification were retained, Food & Beverages weight would have declined to 40.10%, but under the new COICOP-based CPI 2024 classification, it stands at 36.75%—showing both a real consumption shift and a structural classification change.
Why lower food weight can change “headline inflation”
Food prices are often volatile due to weather, supply chain disruptions, and seasonal factors, so a lower weight typically reduces the extent to which sudden food spikes swing the overall CPI number. That can make headline inflation appear more stable, even though food inflation still matters because food remains the single largest component of the CPI basket.
2) Basket expanded: 299 items → 358 (more services)
The revised CPI broadens the consumption basket from 299 to 358 weighted items at the all-India level. Within this, goods items increased from 259 to 308 and services items from 40 to 50, strengthening services representation.
MoSPI’s “What’s New” list highlights key new additions such as:
- Rural housing (including rural house rent coverage).
- Online media service provider/streaming services (OTT).
- Items like pen-drive & external hard disk, exercise equipment, plus service-type items such as attendant and babysitter.
At the same time, some outdated items were removed (e.g., VCR/VCD/DVD player and hiring charges, radio, tape recorder).
3) New structure: 12 divisions under COICOP 2018
The earlier CPI structure had 6 broad groups, while CPI 2024 adopts COICOP 2018 and classifies expenditure into 12 divisions, enabling more granular dissemination and international comparability. This restructuring is one reason the weights look different, because several items get re-mapped into new divisions.
MoSPI notes the hierarchy now runs deeper (12 divisions, 43 groups, 92 classes, 162 subclasses, and 358 items), which helps users track inflation at a finer level.
4) Housing and utilities now matter more
In the CPI 2024 weighing diagram, “Housing, water, electricity, gas and other fuels” carries a combined weight of 17.665%. This reflects a stronger role for housing-related spending in household budgets and a broader definition that includes utilities alongside housing.
A particularly important coverage improvement is the first-time inclusion of rural house rent, expanding the index’s housing footprint beyond predominantly urban rent measurement.
5) Digital-era price collection: online markets + tablet-based system
The CPI 2024 series introduces Computer Assisted Personal Interviewing (CAPI)—tablet-based electronic price collection with built-in validations and real-time monitoring. MoSPI also adds alternative sources to reflect changing purchase behaviour, including:
- E-commerce prices as an additional market in 12 large towns (population > 25 lakh).
- Online collection for select services like airfares and OTT subscriptions.
MoSPI states CPI 2024 covers 1,465 rural markets and 1,395 urban markets (across 434 towns) plus 12 online markets.
First inflation print under CPI 2024: January 2026
The first CPI inflation print under the new base shows All-India CPI (General) inflation at 2.75% (provisional) for January 2026 over January 2025, with rural at 2.73% and urban at 2.77%. MoSPI also reports CFPI (food inflation) at 2.13% (provisional) for the same period (rural 1.96%, urban 2.44%).
What this means for policy, markets and households
A more representative CPI improves the quality of inflation measurement used by policymakers, businesses, and households for decision-making. With lower food weight, inflation may look less “jerky” month to month, while categories like housing/utilities, transport, and services may now exert more influence on the headline number.
MoSPI also provides linking factors and a back-series framework to maintain continuity for time-series analysis, though it notes the two series can be directly linked only at the general index level due to classification differences.
UPSC relevance
- GS 3 (Economy): CPI base revision and how inflation measurement impacts monetary/fiscal policy interpretation.
- GS 3 (Economy): Changing weights (food down; housing/services up) and structural shift in consumption patterns (HCES 2023–24).
- Prelims: Base year 2024=100, Food & Beverages weight 36.75%, items 299→358, COICOP 2018, online markets 12, rural markets 1,465 and urban markets 1,395.
FAQs
Q1. What is the new CPI base year in India’s revised inflation series?
The revised CPI series uses base 2024=100, released by NSO, MoSPI on 12 February 2026.
Q2. How much did the Food & Beverages weight change?
In CPI 2024, Food & Beverages weight is 36.75% (combined), compared to 45.86% in the CPI 2012 group-wise structure.
Q3. What new items/services are included in CPI 2024?
The series adds items such as rural housing, online media/streaming services (OTT), and expands modern goods/services coverage.
Q4. How many items are covered in the revised CPI basket?
The number of weighted items increased from 299 to 358 (308 goods, 50 services).
Q5. What was the first CPI inflation print under the new base?
For January 2026, CPI (General) inflation was 2.75% (provisional) year-on-year.
