The changes ensure that payments such as dearness allowance or pensions, that are linked to the CPI, will be more closely based on the true consumption baskets of households.
First inflation readings under the revised CPI framework comes in at 2.75%, with food inflation at 2.13 percent, as MoSPI expands market coverage & updates consumption weights.
New CPI series will take 2024 as base year, will provide more accurate measure of inflation, spending on digital services. Expected to enhance representation and reliability, says Saurabh Garg.
Household Consumption Expenditure Survey shows urban-rural gap has narrowed, particularly at lower levels of consumption, implying effectiveness of govt policies in improving rural incomes.
RBI has retained its inflation projection at 5.4% for the current year. Uncertainties in food prices and volatility in global crude oil prices continue to keep 4% target out of reach.
Indian Council of Applied Economic Research study says bans on export of wheat & rice were ‘knee-jerk’ reactions. Govt should adjust its trade policy, not sell at prices lower than MSP.
Food has an outsized weightage in Consumer Price Index, but education and health too little. This is because CPI is based on spending patterns of 'average Indian' from 12 years ago.
Food price hike driven by higher rates of vegetables, pulses & their products, spices, eggs, meat and fish. While jump in vegetable prices expected, inflation in cereals & their products worrying.
The system was to delivered in March but will now reach the Indian shores by May, or June. The fifth S-400 will be delivered in the last quarter of this year.
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