How do alternative data sources and international classification standards strengthen the credibility of India's price statistics?

The Consumer Price Index (CPI) is the legal anchor of India's 4% ±2% inflation target [3], so its accuracy affects both monetary policy and public trust. The new CPI series (base 2024=100), launched by NSO-MoSPI in February 2026, makes price statistics more credible because it uses richer data and global methods [1].

Alternative data sources: wider, more current coverage

• E-commerce prices: 12 online markets in towns with more than 25 lakh people now capture how urban India actually shops [1].
• New-age services: OTT subscription prices and online airfares are tracked, so the basket reflects what households spend on today [1].
• Administrative data: rail fares come from Railways records, mobile tariffs are weighted by TRAI subscriber shares, and fuel prices come from PPAC [1].
• Tablet-based CAPI has replaced paper schedules, which cuts transcription errors. The September 2026 round recorded a 100% response rate [1][2].
• Result: fewer manual estimates and prices closer to what consumers really pay.

International standards: comparability and sound method

• COICOP 2018 (UN Statistics Division) organises the basket into 12 divisions, 43 groups, 92 classes and 162 sub-classes. This makes Indian CPI comparable with other economies [1].
• IMF CPI Manual: free social transfers such as free PDS grain are left out, so the index consistently measures market prices [1].
• Standard index formulas: the Jevons formula is used for elementary indices and Young/Modified Laspeyres for aggregation [1].
• Updated weights (HCES 2023-24): food & beverages fall from 42.6% to 36.8%, the basket grows from 299 to 358 items, and rural housing is covered for the first time [1].
• Back series with linking factors (Combined 0.5267) keep the long-run data continuous [1].

Remaining gaps

• Linking factors join the old and new series only at the general index level, so item-level comparisons over time are weaker [1].
• MoSPI warns that state item indices may rest on thin samples [1][2].

Taken together, digital data and global standards make India's CPI more representative, timely and comparable. MoSPI should keep publishing its methods openly, enlarge state-level samples and rebase regularly in step with consumption surveys. Reliable price data is the basis of a credible inflation-targeting framework and of evidence-based economic policy.