During the fiscal year 2023-24 (FY24), many particular states saw higher inflation than the overall India average. Because food inflation has been strong, inflation in producing states is slightly lower than in states that import these products. When rice production or tur output in producing states falls, inflation rates rise for those who import from these states because logistical costs and margins rise across these regions.
In Telangana, inflation has been highly variable, led by price increases in vegetables, grains, and pulses. In Rajasthan, high cereal and spice prices have been a major factor. Rajasthan has one of the highest value-added taxes (VAT) on petrol and diesel. Higher gasoline and diesel prices tend to leak over into other commodities. In Haryana, inflation is strong due to high food and clothing costs.
Manipur’s inflation rate has risen every month since the state’s conflict erupted in May of last year. Uttar Pradesh has had significant inflation for 11 months in fiscal year 24. In Gujarat, Odisha, Karnataka, Tripura, Bihar, Punjab, and Andhra Pradesh, interest rates were higher for 7- 10 months in FY24.
In the meantime, seven states and union territories, including Delhi, Goa, Sikkim, Nagaland, Chandigarh, West Bengal, and Jammu & Kashmir, experienced lower inflation rates over the last fiscal year. Chhattisgarh and West Bengal are big rice producers with lower grain inflation rates. Rice and wheat prices are more tightly controlled than pulses and vegetables, which can distort
the data.
The Reserve Bank of India (RBI) estimates retail inflation to be around 4.5% in FY25.