New Delhi
Inflation eased further for India’s agricultural and rural workers in July, providing relief to vulnerable households. According to the Ministry of Labour and Employment, year-on-year inflation based on the Consumer Price Index for Agricultural Labourers (CPI-AL) fell to 0.77 percent, while inflation for Rural Labourers (CPI-RL) declined to 1.01 percent.
Food inflation dropped into negative territory, with CPI-AL at -1.56 percent and CPI-RL at -1.13 percent, mainly due to increased food production. Compared to June, when inflation stood at 1.42 percent and 1.73 percent, the July figures reflect continued improvement. Inflation rates for these groups have been steadily falling for nine consecutive months.
Officials noted that the decline eases pressure on poor households, who are most affected by rising prices, and leaves more disposable income for non-food purchases, improving living standards.
The Labour Bureau recently updated the base year of CPI-AL and CPI-RL to 2019=100, replacing the older 1986–87 series. The new system, in use since June, expands coverage and introduces methodological changes to better capture price trends.
Key improvements include updated weighting diagrams reflecting current consumption patterns, adoption of the Geometric Mean instead of the Arithmetic Mean to reduce volatility, and alignment with international COICOP-2018 standards. The revised series also expands coverage to 34 States and Union Territories, 787 sample villages, and 150–200 items, compared to 20 States, 600 villages, and 65–106 items earlier.
Additionally, the calculation of Public Distribution System (PDS) prices now uses the “admissibility” concept rather than availability, improving accuracy.
