Food inflation has been a great contributor to inflation in recent years that people have planned to get rid of certain foods to avoid burn holes in their pockets.
The situation is however likely to improve around T4F25 with the seasonal relaxation of vegetable prices and the arrival of the Kharif harvest, according to the economic survey filed in Parliament today. The Minister of Finance of the Union, Nirmala Sitharaman, deposited the document in the two chambers of Parliament – Lok Sabha and Rajya Sabha – today.
If Rabi production is good enough, then food prices are likely to be contained in the first half of 2026.
“Discomplete weather events and the increase in international prices for agricultural raw materials have risks for food inflation. economic uncertainty “, the document was read.
On a global scale, food inflation is on a downward trend due to the improvement of supply conditions taking into account solid harvests and the conditions for cultivating favorable crops.
But why could India have not been able to contain food inflation? In India, however, the food inflation rate has remained firm due to the disruption of the supply chain has worsened by extreme weather conditions and a reduced harvest of certain foods such as vegetables and legumes.
Vegetables and legumes represent a weight of 8.42% together in the IPC basket while their contribution to overall inflation was 32.3% in financial year 25, in accordance with the economic survey.
The document also noted that when excluding the two articles, the country’s average food inflation rate for financial year 25 was 4.3%, more than 4% less than global food inflation.
The economic survey, prepared under the supervision of the chief economic advisor against Annantha Nageswaran, also said that the sharp increase in the prices of tomatoes and onion caused by the disturbances of the weather linked to the weather has caused rates of ‘higher inflation during the 2010 financial year.
“When we exclude the three vegetables most sensitive to prices (tomato, onion and potato (top)) from the CPI basket, the average food inflation rate of 25 (April-December) was 6.5%, this which is 1.9% lower than that of the exercise current food inflation.