By : Smritika Banerjee
India’s government is incorporating real-time price information from leading online retailers like Amazon and Flipkart in order to keep pace with the digital economy. This initiative aims to better capture the evolving shopping habits of Indian consumers, who increasingly favour online platforms for their purchases.
In order to access extensive pricing data, the Ministry of Statistics and Programme Implementation (MoSPI) has started engaging with major e-commerce players. The MoSPI Secretary Saurabh Garg said that the price snapshots from websites across 12 large cities have already been collected, and each of whose populations exceeds 2.5 million. This new data collection method will make the Consumer Price Index (CPI)—a key indicator for monetary policy—more accurate and current.
Recent results from household expenditure surveys have prompted calls for digital integration, as they show the rising percentage of Internet spending in Indian homes. The government intends to fill the gaps left by traditional survey methods, which primarily rely on in-person market visits, by integrating e-commerce information into the CPI. With countries like the US and South Korea already including internet and scanner data into their inflation calculations, this approach reflects global trends.
E-commerce platforms are now being asked to provide weekly average prices for a wide array of goods. These figures will be carefully cross-checked against other data sources to maintain the integrity of the index. With expenditure trends shifting towards other sectors, the updated CPI, which is anticipated to emerge early next year, will lessen the focus on food and rebalance the weighting of various categories. It will also include digital service costs, such as airline fares and streaming subscriptions, reflecting the modern digital lifestyle of Indian consumers.
The government’s broader efforts were modernizing economic indicators behind the update. Alongside the CPI revision, MoSPI is working on a new GDP series based on the 2022-23 year and developing a quarterly Index of Services Production to better monitor India’s booming service sector, which now contributes over half of the nation’s economic output. These steps collectively aim to provide policymakers and the public with sharper, more reliable economic insights.