India launches new consumer price index

New Delhi: Even as it fights a desperate battle to reign in rampant inflation India launched a new consumer price index on Friday which will measure the cost of living across rural and urban areas differently than earlier.

Dubbed the "common man's" index, it is not intended to replace India's main price index - the Wholesale Price Index - but it will provide the central bank another measure to assess rising costs that are now causing tempers to rise across the land.

Existing consumer price indices do not "reflect the true picture of price behaviour in the country" as they do not embrace all parts of the population, India's chief statistician TCA Anant said ahead of the index's launch.

The new index estimated consumer price inflation at six per cent nationwide in January, more than two percentage points below the Wholesale Price Index, which measures a wider basket of goods such as machinery and basic metals.

The new tool joins a series of separate consumer price indices for industrial workers, agricultural labourers, and urban non-manual employees.

It will measure price rises in food, beverages and tobacco, fuel, housing, clothing, bedding, footwear and other goods.