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Indian Economy / Price Indices and Inflation

Consumer Price Indices in India


    Consumer Price Index ( CPI ) is a statistical measure to study the price changes in consumer goods and services that are generally purchased by households.

    Consumer Price Index for Industrial Workers ( CPI-IW )

    • It measures the change in prices of basket of consumer goods and services that are consumed by the Industrial Workers.
    • The base year of CPI for Industrial Workers is 2001.
    • CPI-IW is compiled by Labour Bureau, Ministry of Labour and Employment, Government of India.
    • Periodicity of release of CPI-IW numbers is monthly.
    • This index number is being utilized
      • To study the inflation from consumer point of view.
      • To determine the Dearness Allowance ( DA ) installment to various employees in the organized sector ( both private and public ).
      • To update and alter the urban poverty line.

    Consumer Price Index for Agricultural Labourers and Rural Labourers ( CPI-AL/RL )

    • It measures the variations in the retail prices of goods and services that are consumed by the agricultural and rural labourers
    • The base year of CPI for agricultural labourers and rural labourers is 1986-87.
    • CPI( AL/RL ) is compiled by Labour Bureau, Ministry of Labour and Employment, Government of India..
    • Periodicity of release of CPI( AL/RL ) numbers is monthly.
    • This index number is being utilized
      • To determine the minimum wage to the worker in the unorganized sector.
      • To update and alter the rural poverty line.

    Consumer Price Index ( Rural, Urban, Combined )

    • Consumer Price Index ( Rural ) and Consumer Price Index ( Urban ) as well as Consumer Price Index ( Combined ) are indices that have a wider coverage of population.
    • These indices are compiled by the Central Statistical Organization ( CSO ), Ministry of Statistics and Programme Implementation, Government of India.
    • The base year for CPI ( Rural ), CPI ( Urban ) and CPI ( Combined ) is 2012.
    • Periodicity of release of CPI ( Rural ), CPI ( Urban ) and CPI ( Combined ) numbers is monthly.
    • Price change data are collected from selected cities/towns of different States and Union Territories by the Field Operations Division of NSSO and similar data is collected from selected villages of different States by the Department of Posts. Price change data that are received through various web portals, are being maintained by the NIC ( National Informatics Centre ).
    • The RBI is using Consumer Price Index ( Combined ) as the sole inflation indicator for the purpose of its monetary policy.
    • In addition to the above three consumer price indices, CSO also releases Consumer Food Price Index ( CFPI ) numbers for the rural, urban and combined. These are the measure of retail price changes in food products that are consumed by a set of population in a particular area. The base year for CFPI is 2012 and the numbers are released monthly.