The secret core.

"India's wholesale inflation contracted to 0.13% in June on an annual basis, marking the lowest rate recorded since October 2023, according to government data." It was 0.39% in May. "As inflation eased overall, the primary fall in prices in June was recorded in the food basket." "The Reserve Bank of India's (RBI) Monetary Policy Committee (MPC), in its April meeting, cited a continued moderation in price pressures, mainly driven by softer food costs." ET. "India's retail inflation eased to a six-year low of 2.10%, June aided by an easing of food price rises and favorable base effects." "Food inflation, which accounts for nearly half of the Consumer Price Index (CPI) basket, slipped to -1.06% in June from 0.99% in May." "However, core inflation has ticked up," said Upasna Bhardwaj, Chief Economist at Kotak Mahindra Bank. ET. TOI gave a breakdown of prices in different sectors and the difference between rural and urban inflation levels. Low CPI inflation is expected to help the RBI cut its policy rate further.  "However, the deflation in food prices is likely to lead to discussions among policy makers about the prospects for the agriculture sector given the government goal of improving farm income." Mint. "Agricultural income in India is generally exempt from income tax under Section 10(1) of the Income Tax Act." Bajaj Finserve.  But, "Indian farmers are actually net taxed," said economist Dr Ashok Gulati. "You give subsidies on inputs - fertilizer, free power, this and that. But at the drop of a hat, you put export bans. You say - private sector cannot hold stocks." "So there are Essential Commodities Act provisions which are a draconian 1939 Defense of India rule, then 1955." BT. In 2019, Prime Minister Narendra Modi announced a scheme to pay Rs 6,000 (about $68) per year in direct benefit transfer to farmers. NDTV. "Core inflation, which excludes volatile items such as food and energy and is an indicator of domestic demand, was at 4.4%-4.5% in June from 4.17%-4,20% in in the previous month, according to three economists. India's official statistics agency does not publish core inflation data." Reuters. An RBI paper in February 2024 showed that "The difference between headline and core inflation was found to have negative impact on future inflation changes. In other words, when the difference is negative (as is the case now - headline inflation lower than core inflation), headline inflation is predicted to increase in future. Second, over the long term, headline inflation tends to converge with core." Thus, "Core inflation has predictive power," wrote Deepa Vasudevan. Then why is core inflation avoided by the government? "I certainly believe they (RBI) should cut interest rates. Growth needs further impetus," said Union Minister of Commerce and Industry Piyush Goyal. It is "absolutely flawed theory" that high CPI inflation due to high food prices can be controlled with interest rates. ET. So, cut interest rate by ignoring CPI inflation due to high food prices and cut interest rate when CPI inflation is falling because of falling food prices. RBI has only one function, to cut interest rates. No wonder, core inflation, which cuts out volatile food and energy prices (Investopedia), is not published. And farmers are repressed.