Srinagar: Jammu and Kashmir continues to lead the chart in terms of recording highest retail inflation across the country; the Union Territory has recorded 7.10 percent inflation during the month of November.
The retail inflation inched up to a three-month high of 4.91 percent in November, mainly due to an uptick in food prices, government data showed on Monday. Jammu and Kashmir’s inflation is almost double the national inflation rate.
J&K is continuously recording higher inflation rates. Major factors attributing to the rising costs in the Union Territory is heavy dependence on imports from other places. J&K on an average imports goods and food items worth Rs 40,000 crore annually from other states.
The ever increasing petroleum prices have become a major reason for the escalating inflation in the UT, given the heavy transportation costs and tough terrain. With around 52 percent state and central taxes on fuel, the prices of petrol and diesel have shot up.
The Consumer Price Index (CPI) based inflation, however, remained within the comfort zone of the Reserve Bank of India. The government has mandated the central bank to keep the inflation at 4 percent (+/- 2 per cent).
The annual CPI inflation was 4.48 per cent in October 2021 and 6.93 per cent in November 2020. It had eased from 5.3 per cent in August to 4.35 per cent in September and then moved up to 4.48 per cent in October.
As per the data released by the National Statistical Office (NSO), inflation in vegetables segment was negative on a yearly basis. However, it was on the higher side as compared to the preceding month.
The rate of price rise in the 'oils and fat' segment was 29.67 per cent year-on-year. The inflation was, however, lower in November over October.
On the other hand, inflation in the fruit basket was higher in November over the preceding month.
Overall, inflation in the food basket was 1.87 per cent in November compared to 0.85 per cent a month earlier. However, it was significantly down from 9.5 per cent in November 2020.
With the Centre and state governments reducing taxes on petrol and diesel, inflation in the 'fuel and light' segment was low on a sequential basis.
The Reserve Bank, which mainly factors in the retail inflation while arriving at its bi-monthly monetary policy, has been tasked by the government to keep the inflation at 4 percent with margin of 2 per cent on either side.
The RBI had last week said over the rest of the year, inflation prints are likely to be somewhat higher as base effects turn adverse. However, it is expected that headline inflation will peak in the fourth quarter of the current fiscal and soften thereafter.
The RBI has projected the CPI inflation at 5.3 per cent for 2021-22.
The NSO collects the price data from selected 1,114 urban markets and 1,181 villages covering all states and union territories through personal visits.
During November 2021, NSO collected prices from 99.7 percent villages and 98.4 percent urban markets.
As per the data, inflation in the rural areas was 4.29 percent and in urban India it was 5.54 percent.