The food inflation in India fell to 8.66 percent year-on-year in February 2024. In 2023, the food inflation peaked in July at over 11 percent.
Impact of global influences
Global food inflation, caused by COVID-induced supply chain shocks and Russia’s war on Ukraine, also impacted food prices in India. Imports of edible oils have been impacted by these factors. Other factors such as higher feedstock costs and an increase in minimum support prices led to an increase in food prices. The rise in food prices, which comprise about half of the consumer price index (CPI) basket, affects large sections of the Indian population. Moreover, the heat wave in March 2022 led to a decline in wheat production in that year, a staple food in India. Hence, the government had to ban wheat exports to ensure sufficient domestic supplies.
Domestic contributors to food inflation
Oil and fats were the leading items to inflation in the country in 2022. The increase in the price of edible oils led many Indians to consider cheaper alternatives for cooking. Since India is dependent on international imports for more than half of its edible oil consumption, the government announced a reduction in duties, stock controls, allowing imports of refined oils, and other measures to control the situation.
