Consumer Price Indices (CPI) measure changes, over time, in the general level of prices of goods and services that households acquire for the purpose of consumption. CPI numbers are widely used as a macroeconomic indicator of inflation, as a tool by governments and central banks for inflation targeting and monitoring price stability, and as deflators in the national accounts. CPI is also used for indexing dearness allowance to employees for increase in prices. 

CPI is compiled across states/union territories and at all-India levels for the entire urban and rural poplulation and then grouped into combined category.

Consumer Price Index numbers are published by the Ministry of Statistics and Programme Implementation(Government of India) by taking 2010 as the base year. This brochure from the Ministry of Statistics and PI gives an extremely good general introduction to CPI and all the nuances surrounding it.

About the analysis

This analysis tries to understand the spread of CPI numbers across different categories and since January 2011. The data has been published till July 2014, while the August 2014 numbers are still provisional and hence have not been considered in this analysis.

Visualisations have been used to present the data in a concise and clear way so that trends and outliers can be easily spotted. The time windows considered for each of the analysis have been mentioned along with the visualisations.

Weighting diagram

A weighting diagram gives the share of each item considered in the total consumption expenditure. Item-level elementary aggregates are aggregated into multiple categories based on the weights associated with each level.

The following 3 tree-maps show the weights of each category in different index categories, namely, Rural, Urban and Combined.


Left-Click a region to zoom-in (a level in), and then Right-Click to zoom-out (a level down).

  • There is no 'Housing' Category for Rural.
  • In Urban, 'Transport and Communication' gets a higher weighting than 'Medical Care'.

Category Increase

As the data has been compiled since January 2011, it would be interesting to see the growth in each category since then. The following visualisation shows the category-wise increase.
  • Across all categories, rural indices have seen an increase over their equivalent urban indices.
  • There has been an average increase of 30 per cent since January 2011 across categories.
  • 'Clothing and Bedding' and 'Housing' have seen the highest increase, while 'Miscellaneous' has seen the lowest.


The following visualisation shows the behaviour of the 'General Index' since January 2011. The trend-line shows an overall upward slope, though it plateaus out over certain time windows.

  • There has been a 37 per cent increase in the General Index since January 2011.
  • Though the index continues to grow, it is interesting to see that it evens out around the beginning of the year (around January) almost consistently over this time period. We shall corroborate this observation in the next few visualisations.

The following visualisation captures the percentage increase in the 'General Index' over the previous month. This highlights the earlier observation of the index plateauing near the beginning of the year in greater detail. Also noteworthy is the way the index drops consistently between December and January. It would be interesting to study the reasons behind such behaviour. 


Now, if we superimpose the 'Food, Beverages and Tobacco' category across the different segments, it captures the index-point increase over the previous month.

The difference over the previous month underscores other important characteristics of the index behaviour. This category also sees a drop around December-January for each of the years.



The change of guard in the government in 2014 brought with it a lot of hope, not least on the inflation front. The following visualisation shows the index point change over the period January 2014 to July 2014. Though it would be most interesting to compare the way the index has been behaving under the old and new goverments, the fact that the index historically drops during the beginning of the year and then picks up steam, invalidates the possible obervation that there has, in fact, been an increase in prices since the Narendra Modi-led Government assumed power.


A closer watch on this index over the next few years could lead us to further analysis of the policy actions and changes by this new government and their overall impact on the economy and the lifestyle of the people.