How Does India Measure Inflation? Inside the CPI Basket
See how the basket of goods and services in the Consumer Price Index (CPI)—used to measure retail inflation—has changed from 2012 to 2024.
Key takeawayFood is now a smaller part of the inflation basket than it was in 2012. Transport and housing count for more.
Each category in the CPI basket counts in proportion to how much households spend on it. So a price rise in a heavy category, like food, moves the headline inflation number more than the same rise in a light one, like recreation.
Since February 2026, the Ministry of Statistics and Programme Implementation (MoSPI) has used a new basket based on how households spent in 2024, replacing the one based on 2012.
Breaking Down India's CPI Basket
Food and drinks lost the most weight, falling from 42.6% to 36.8% of the basket. Transport gained the most, rising from 6.4% to 8.8%, and housing and utilities rose from 16.9% to 17.7%.
| Category | 2012 basket | 2024 basket | Change (percentage points) |
|---|---|---|---|
| Food and drinks | 42.6% | 36.8% | −5.8 |
| Housing and utilities | 16.9% | 17.7% | +0.8 |
| Transport | 6.4% | 8.8% | +2.4 |
| Clothing and footwear | 6.5% | 6.4% | −0.1 |
| Health | 5.9% | 6.1% | +0.2 |
| Personal care and other | 4.0% | 5.0% | +1.0 |
| Household goods | 3.7% | 4.5% | +0.8 |
| Phone and internet | 3.3% | 3.6% | +0.3 |
| Eating out and hotels | 3.2% | 3.3% | +0.1 |
| Education | 3.5% | 3.3% | −0.2 |
| Paan and tobacco | 2.4% | 3.0% | +0.6 |
| Recreation | 1.5% | 1.5% | 0.0 |
A smaller food weight means a spike in onion or tomato prices now moves headline inflation a little less than it used to.
What else changed in the new basket
The weights are not the only change. The new basket tracks 358 items, up from 299, after obsolete products were dropped and newer ones added. Its weights come from the Household Consumption Expenditure Survey (HCES) 2023-24.
Prices are now collected from 1,465 rural markets and 1,395 urban markets, and from 12 online markets, according to the ministry’s questions and answers on the new series. The categories changed too: six broad groups became 12, which is why the table above shows both baskets in the new 12 categories. The first reading under the new series put retail inflation at 2.75% in January 2026.
Source and method
MoSPI, first press release of the Consumer Price Index (base 2024 = 100), 12 February 2026. All-India combined weights. The 2012 weights are as re-classified by MoSPI into the 12 categories of the UN Classification of Individual Consumption According to Purpose (COICOP 2018). The item count, markets, survey and the January 2026 inflation figure come from the same release and its questions and answers annex.
