FM says retail inflation now stable, cost of essentials coming down

Finance Minister Nirmala Sitharaman replying to a discussion on the FY25 Interim Budget in the Lok Sabha on February 7

Finance Minister Nirmala Sitharaman on February 7 said that India's retail inflation is now stable and is well within the mandated tolerance band of 2-6 percent.

"Retail inflation has declined from an average of 6.8 percent in April-December 2022 to 5.5 percent in the corresponding period of 2023... The core inflation has actually declined from 5.1 percent in April 2023 to 3.8 percent in December 2023," Sitharaman said while replying to a discussion on the FY25 Interim Budget in the Lok Sabha.

India's headline retail inflation has eased in recent months after touching a 15-month high in July 2023. In December, the rate came in at 5.55 percent, within the Reserve Bank of India's (RBI) tolerance range of 2-6 percent for the third month in a row. However, it has now been above the medium-term target of 4 percent for 50 consecutive months.

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Articulating the steps taken by the Centre to keep a lid on inflation, especially on food prices, Sitharaman said, "Prices of essentials like atta, dal, onions and also rice have come down."

Sitharaman added that subsidised essentials in the form of Bharat Atta and Bharat Dal among others have helped cool down prices.

"Around 2.37 lakh metric tonne of atta has been sold, priced at 27.50 per kg, under the Bharat Atta initiative as of January 28, 2024. This is already sold to the public and to that extent prices have cooled down," the FM said.

In a bid to control food prices for consumers, the Union government has launched subsidised versions of essentials, with the latest one being Bharat Rice.

The Consumer Food Price Index was down 0.9 percent month-on-month (MoM) in December 2023, aided by a 5.3 percent sequential fall in the price index for vegetables as prices continued to correct.

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