- Why in news
- On 23 March 2026, the Minister of State for Statistics told the Rajya Sabha that MoSPI has revised the CPI base from 2012=100 to 2024=100, using HCES 2023-24 data and adding e-commerce prices.
- What it is
- The Consumer Price Index measures changes in retail prices of a fixed basket of goods and services bought by households. Its base year and item weights are updated from time to time so that the basket reflects current spending patterns. MoSPI compiles the national CPI, and it is widely used to track retail inflation.
- Base change
- CPI base year moves from 2012=100 to 2024=100.
- Weights source
- The item basket and weights are updated using HCES 2023-24.
- Sample markets
- Sample markets in rural and urban areas rise from 2295 to 2860.
- Online markets
- 12 online markets are added across the 12 biggest towns, those with over 25 lakh population per Census 2011.
- Online price collection
- E-commerce prices are collected weekly in all four weeks, and a monthly average is used in CPI.
- Compiler
- MoSPI compiles the national CPI; the RBI uses CPI-Combined as its inflation target measure (4% with a band of 2%).
Don’t confuse with CPI vs WPI: CPI tracks retail prices paid by consumers and is compiled by MoSPI. WPI tracks wholesale prices and is compiled by the Office of the Economic Adviser, DPIIT.
Don’t confuse with HCES vs PLFS: HCES measures household consumption spending; PLFS measures employment and unemployment. Both are NSO surveys.
Economy terms and data: 42 Prelims questions since 2013, rising in recent years; they test what a term or instrument means. In Mains, 12 news-triggered questions.
Why it matters
- A current basket and weights make inflation figures more accurate, helping RBI monetary policy under inflation targeting.
- Online price capture reflects how households now shop, making CPI more representative.
- CPI is used to index wages, allowances and some contracts, so its accuracy matters.
Problems
- Online prices are volatile and platform-specific, so comparability with offline prices is hard.
- A new base breaks continuity with the 2012 series, so linking old and new data needs care.
- Only 12 online markets in big towns may not represent rural or smaller-town e-commerce use.
Way forward
- Publish clear linking factors and methodology so users can compare old and new series.
- Review the basket regularly and extend online coverage as e-commerce spreads.
- 2021Mains GS3 · Q1Explain differences in GDP computation methodology before and after 2015 base revision
- 2024Mains GS3 · Q2Causes of persistent food inflation and RBI monetary policy effectiveness
- 2019Mains GS3 · Q2Whether steady GDP growth and low inflation leave India in good shape
- 2020Prelims Q67Statements on CPI versus WPI food weightage and services coverage; which are correct
- 1997Prelims Q67Which index measures inflation in India: WPI or a consumer price index
- 2010Prelims Q86Statements on WPI frequency and food weight compared with CPI(IW)
UPSC’s own questions that come close to this issue, from our Prelims and Mains banks.
Prelims practice · Statement I and II
Ours, not from a UPSC paper
Consider the following statements regarding the revision of the Consumer Price Index (CPI) announced in March 2026:
- Statement-I: The revised CPI series has 2024=100 as its base, and its item basket and weights are updated using the Household Consumption Expenditure Survey 2023-24.
- Statement-II: The national CPI is compiled and released by the Reserve Bank of India, which uses it as its inflation target measure.
Which one of the following is correct in respect of the above statements?
True or false?
1 of 6
Statements the way Prelims prints them. Say first, then see the fact.
1.The revised CPI series uses 2024 as its base year, replacing 2012.
True. Base moves from 2012=100 to 2024=100.
2.The new CPI basket and weights are derived from the Periodic Labour Force Survey.
False. They are derived from the Household Consumption Expenditure Survey 2023-24.
3.The number of sample markets has been increased from 2295 to 2860.
True. Sample markets rise from 2295 to 2860.
4.Online markets have been added in the 12 biggest towns, defined as those with population above 25 lakh per Census 2011.
True. 12 online markets in 12 towns with over 25 lakh population (Census 2011).
5.E-commerce prices for the CPI are collected once a month on a fixed day.
False. They are collected weekly, in all four weeks, and averaged monthly.
6.Changing the base year of a price index is meant to make the basket reflect current consumption patterns.
True. Rebasing updates items and weights to current spending.
Written by us from the release, not by UPSC; checked by a second model.
Mains practice
10 marks · 150 words
MoSPI has revised the base of the Consumer Price Index from 2012=100 to 2024=100, using HCES 2023-24 data, a larger sample of markets and e-commerce price collection. Discuss the significance of rebasing the CPI and examine the challenges in measuring retail inflation accurately in India.
Worth revising until Prelims 2027: most news questions come within two years of the event.