E-Shopping to Be Included in India’s Inflation Index for the First Time
In a significant move to modernize India’s inflation measurement, the government is preparing to include online shopping expenses in the Consumer Price Index (CPI) calculations. This will be the first time that e-commerce spending is officially incorporated into the country’s inflation basket, reflecting changing consumption patterns.
According to officials, the Ministry of Statistics and Programme Implementation will collect online spending data from 12 major cities and track e-commerce prices across 25 large urban centers with populations exceeding 2.5 million.
The current inflation calculations are based on consumption trends recorded in 2011–12. However, with the exponential rise in online shopping over the past decade, experts believe that excluding e-commerce transactions is no longer appropriate. Data shows that online retail spending now accounts for nearly 3–4% of household consumption and continues to grow rapidly.
Potential Expenses to Be Covered
The new methodology will track prices of frequently purchased online goods and services, including groceries, ready-to-eat meals, medicines, apparel, and electronics. Analysts estimate that including e-commerce data may increase the recorded inflation rate by about 0.56%.
Key Benefits
Officials outlined several advantages of this move:
- More Accurate Inflation Estimates: Tracking online discounts and purchasing behavior will make the CPI more realistic.
- Better Policy Support: The Reserve Bank of India and policymakers will get clearer insights into actual spending trends.
- Enhanced Consumer Awareness: Transparent inflation tracking will help consumers better understand price movements.
- Protection of Consumer Interests: Regular monitoring will prevent artificial inflation or hidden pricing in e-commerce platforms.
The ministry plans to draw data from multiple online marketplaces to ensure comprehensive coverage. Nearly 2,900 urban and 1,200 rural centers are already part of the current inflation survey network, and e-commerce tracking will be integrated into this framework.
The revised CPI incorporating online spending patterns is expected to be implemented by the next year.
