CPI overhaul: Govt to track Amazon and Flipkart costs, inflation gauge to reflect digital shopping boom

India’s inflation index is ready for its greatest makeover in years, with the federal government making ready to pull value knowledge straight from e-commerce platforms resembling Amazon and Walmart-owned Flipkart. The plan marks a decisive shift in how retail inflation might be measured — bringing on-line shopping, streaming companies and digital airfares into the equation.Officials say the transfer comes as India’s consumption patterns tilt quickly in direction of digital spending, Reuters reported. A non-public research estimated that the nation had 270 million internet buyers in 2024, a determine projected to develop by 22% yearly.

How the brand new system will work

Saurabh Garg, secretary of the Ministry of Statistics and Programme Implementation, instructed Reuters that the ministry has already begun scraping costs in 12 cities with populations above 2.5 million. Talks are additionally underway with platforms for direct knowledge entry.“E-commerce is a growing share of household spending and the Household Consumption Expenditure Survey shows it’s significant enough to be reflected in the CPI basket,” Garg mentioned. “The aim is to make the index more representative and timely.”E-commerce companies might be required to share weekly common costs of products, which can then be cross-verified with wider datasets to keep away from skews. The reworked index is predicted to roll out early subsequent 12 months with recent weightages, reflecting the survey discovering that Indians now spend a smaller share of their family budgets on meals.

From food-heavy to digital-heavy

The upcoming CPI basket is not going to simply replace meals and clothes shares but additionally think about classes the place digital transactions dominate. This consists of airfares and streaming-media subscriptions, that are set to be pulled from on-line sources.

Part of an even bigger statistical revamp

The inflation index overhaul is only one ingredient of a wider statistical improve. Garg mentioned a brand new GDP collection with 2022-23 as the bottom 12 months can be being ready. Earlier this 12 months, the ministry started releasing a brand new funding survey and extra frequent employment knowledge, although some economists have questioned their accuracy.To enhance labour knowledge, the ministry has almost doubled family protection in its month-to-month employment stories from about 45,000 earlier. “The larger sample for monthly periodic labour force survey, thus, ensures that even on a monthly basis, the estimates are precise and robust for making informed decisions,” Garg mentioned.He added “Furthermore, the measurement framework of the PLFS is aligned with internationally recognized standards, ensuring comparability and credibility.”

Services to get their very own index

Alongside the CPI and GDP updates, the ministry is designing a brand new Index of Services Production (ISP) as a quarterly tracker of output within the companies sector. Services account for over half of India’s GDP however are at the moment monitored much less ceaselessly than manufacturing.“This is likely to be rolled out from the middle of next year,” Garg mentioned.