What is the difference between CPI-IW, CPI-AL, CPI-RL, and CPI-Combined?

What is the difference between CPI-IW, CPI-AL, CPI-RL, and CPI-Combined?

Answer:

India publishes multiple Consumer Price Indexes (CPI) because different groups of people face different consumption patterns and price sensitivities.

1. CPI-IW (Industrial Workers):

   • Population covered: Industrial workers in select industrial centres.

   • Base year: 2016 = 100 (revised in 2020 from 2001).

   • Purpose: Used for wage indexation, dearness allowance (DA), and policy for organized labour.

   • Weight pattern: Higher weight for housing, fuel, and light, reflecting urban working-class lifestyle.

2. CPI-AL (Agricultural Labourers):

   • Population covered: Agricultural labour households in rural areas.

   • Base year: 1986–87 = 100.

   • Purpose: Used for wage indexation of agricultural workers, poverty measurement.

   • Weight pattern: Higher weight for food items since food dominates rural consumption.

3. CPI-RL (Rural Labourers):

   • Population covered: Broader rural labour households (not just agricultural).

   • Base year: 1986–87 = 100.

   • Purpose: Similar to CPI-AL, but reflects consumption of non-agricultural rural labourers.

4. CPI-Combined:

   • Population covered: All-India rural + urban population.

   • Base year: 2012 = 100.

   • Purpose: Introduced to have a single, comprehensive inflation measure.

   • Significance: Serves as the official headline inflation index.

👉 Key difference: CPI-IW, AL, RL are occupational group-specific, while CPI-Combined is broad-based and represents the general population.