Some Perspective › Inflation
The one measure that improvedConsumer price inflation is the single exception on this site's cross-era scorecard: it averaged 4.98% under the NDA against 8.05% under the UPA. That gap is real, it is large, and it matters to households more than almost anything else measured here. This page is about what it is evidence of — which, we argue, is very little about Indian policy.
8.05% → 4.98%
This project concludes against the current government on eight of nine measures. When the ninth goes the other way, the temptation is to explain it away in a sentence and move on. That would be exactly the behaviour the project criticises elsewhere. So the exception gets its own page, argued at the length it deserves, with the parts that cut against us stated too.
Brent crude fell from about $115 a barrel in June 2014 to below $30 by January 2016 — roughly 75% in nineteen months. The cause was outside India entirely: United States shale supply arriving at scale, and OPEC deciding to defend market share rather than cut production to hold the price up.
India imports approximately 86% of the crude it consumes. Energy prices enter the consumer price index directly through fuel and light, and indirectly through the transport cost of everything else. A 75% fall in the landed price of the most import-dependent input in the economy is not a small tailwind.
The timing is the point. The shock does not merely occur during the NDA period; it arrives almost exactly at the boundary between the two periods being compared. Any measure that is sensitive to world energy prices will show a break at 2014 whether or not anything changed in Delhi.
Central excise duty on petrol was ₹9.48 a litre and on diesel ₹3.56 a litre in 2014. Between November 2014 and January 2016 it was raised on nine separate occasions — by ₹11.77 a litre on petrol and ₹13.47 on diesel — and the stated purpose was to absorb the gains from falling global prices into the exchequer rather than let them reach the pump.
Two things follow. First, the disinflation that households actually experienced was the residual left after the tax take, so the fall in measured CPI understates how large the imported price shock was. Second, and more awkwardly for anyone claiming credit: to the extent that policy acted on fuel prices in this period, it acted to keep them higher than the world price would have delivered.
About half the retail petrol price in 2026 is still tax — roughly ₹19.9 of central excise and ₹15.0 of state VAT in a ₹94 litre. That is a policy choice with a fiscal rationale, and it can be defended. What it cannot be is evidence of an anti-inflation achievement.
The comparison has two ends, and the earlier one is not a neutral baseline. The UPA's second term coincided with the 2008 food and fuel price spike, the commodity boom that ran through 2013, and the worldwide fiscal and monetary stimulus that followed the financial crisis. Indian inflation ran at 10.9% in 2009, 12.0% in 2010 and 10.9% in 2013.
Setting an era containing a commodity boom against an era containing its collapse produces a difference. That difference is substantially a statement about world prices during two adjacent decades, and only partly a statement about the two governments.
India did adopt formal inflation targeting in this period, and it is a real institutional change. The Monetary Policy Framework Agreement between the government and the Reserve Bank was signed on 20 February 2015. The Finance Act 2016 amended the Reserve Bank of India Act 1934 to give it statutory backing and to create a Monetary Policy Committee, which was constituted in September 2016. The target is 4% consumer price inflation with a tolerance band of two percentage points either side.
There is a reasonable case that this anchored expectations and contributed to the outcome. We do not dismiss it. But notice what kind of thing it is. Inflation targeting is a rule that binds the executive: it moves an instrument out of the discretionary reach of whichever government holds office, hands it to a committee with a published mandate, and requires a written explanation to Parliament when the target is missed.
So if this is the channel, the finding is that India's best macroeconomic outcome in the period came from deliberately constraining executive discretion. That is the argument this project makes everywhere else. It does not qualify the thesis. It is an instance of it.
From the January 2026 print, published on 12 February 2026, the Ministry of Statistics replaced the CPI series based on 2012=100 with one based on 2024=100. The new series draws its weights from the Household Consumption Expenditure Survey 2023-24 and adopts the COICOP 2018 classification in place of the older six-group structure.
Food's weight in the basket falls from 45.86% to 36.75%. The same movement in food prices now produces a smaller movement in headline CPI than it would have under the old series. That is not a manipulation — Indian consumption patterns genuinely changed between 2012 and 2024, and reweighting was overdue — but it does mean the 2026 figure and the 2014-2025 figures are not measuring on identical rulers, and this site labels it as such rather than splicing them silently.
A single national CPI average conceals distribution. A household spending most of its income on food faces something much closer to food inflation than to the headline, and the reweighting described above mechanically reduces how much food shows up in the headline for everyone.
We flag this because it is true and because readers raise it, but we want to be clear that this project has not measured it. Establishing what inflation different income deciles actually faced over 2004-2026 would require expenditure-weighted price indices by decile, which is a real piece of work and not one done here. Treat this section as a caveat on the headline, not as a result.
The honest version of the counter-argument runs like this. Oil fell for everyone, yet not every oil-importing economy brought inflation from double digits to the low single digits and held it there for a decade. Something domestic must have done work. Inflation targeting is the obvious candidate, and there were others: food-price management improved, buffer stock operations were more competent, and the fiscal deficit was consolidated between 2014 and 2018.
We think that case has force, and we have not refuted it. What we have said is narrower and, we think, defensible: the raw cross-era gap cannot be read as a policy result, because a shock large enough to explain most of it arrived at exactly the era boundary; and the leading domestic candidate is a constraint on executive power rather than an exercise of it.
A measure of core inflation — excluding food and fuel — showing a fall of comparable size across the two eras would be strong evidence that something other than the commodity cycle was operating, because it strips out the channel the oil shock runs through. This project does not currently carry a consistent core series back to 2004, so it cannot make that test, and it will not pretend the test has been run.
Comparative evidence would also move us: if India's disinflation is materially larger than that of other oil-importing emerging economies over the same window, the residual needs a domestic explanation.
If either analysis is published and points the other way, it will be recorded on the updates page and this page will be rewritten. That is the standing commitment on everything here.
Inflation is lower under the NDA. This site reports that plainly, counts it as the one measure on which the period performs better, and declines to award credit for it. The gap is mostly the world oil price arriving at a convenient moment; the part of the windfall that policy touched, it taxed; and the domestic institution with the best claim to have helped works by taking discretion away from government.
Read this in the paper → See the cross-era scorecard The walkthrough version