India is getting a new framework to measure retail inflation. Starting January 2026, the country will shift to an updated Consumer Price Index (CPI) that better reflects how Indians spend their money today.
The new index, which will use 2024 as its base year, is built on spending patterns captured in the 2023-24 Household Consumption Expenditure Survey (HCES), noted the statistics ministry on Thursday.
The revamped CPI expands the number of major spending categories from six to 12, offering a more detailed picture of household consumption. The old “miscellaneous” group in the 2012 series, which accounted for everything from health to entertainment to personal care, has been broken into several other smaller divisions.
Basket expansion
In total, the new basket tracks 358 items across 12 divisions, 43 groups, 62 classes, and 192 sub-classes. This is up from 299 items spread across six groups and 23 sub-groups in the 2012 series. The expanded structure follows international standards set by the Classification of Individual Consumption According to Purpose (COICOP) 2018.
The biggest shift in the new CPI series is the reduced weight given to food and beverages. In the 2012 series, food and beverages accounted for nearly 46% of the basket. That share will drop to 37% in the 2024 series.
Food alone, which had a weight of 39% in the old basket, will fall to 35%. This matters because food prices are among the most volatile components in inflation. When food costs spike– as they did through much of 2024 and 2025 – they can sway headline inflation sharply. With reduced weight, future food price shocks will be lesser.
Most other major categories will see only marginal adjustments, with weights shifting slightly up or down.
The new CPI also recalibrates how much each state and union territory contributed to the headline index. Most states will see weight change between -0.5 and 0.5 percentage points.
Four states, however, will see more significant changes. Bihar and Tamil Nadu will get the biggest increases in their CPI weights, while Maharashtra’s weight will decline by 2.6 and West Bengal’s will decline by 0.59 percentage points.
The new CPI series is scheduled for release on 12 February 2026, marking a significant update to India’s inflation measurement framework after more than a decade.