New Consumer Price Index in India to Revolutionize Inflation Measurement.
A new Consumer Price Index (CPI) was introduced in India in 2012 due to flaws in the old system. Previously, only a Wholesale Price Index was used for policy decisions. Recent inflation issues prompted a revamp of how price indices are calculated in India, leading to the launch of the all India CPI. The paper reviews existing price indices in India, pointing out their strengths and weaknesses, and discusses the changes made to improve accuracy.