The media and public debate on the Sri Lankan economy
Sri Lanka: Selected Issues
Sri Lanka under pressure to de-politicize price index;
Pressure is mounting to de-politicize Sri Lanka's new price index, which the authorities are already using as a guide for monetary policy and are pushing trade unions to accept for indexing wages.
The new Colombo Consumer Price Index or CCPI (N) has come under fire for excluding alcohol in an attempt to understate inflation and also for not representing the spending patterns of working class people.
Sri Lanka's Department of Census and Statistics claims that the new index is based on the international 'classification of individual consumption by purpose' or COICOP.
But one of the eleven expenditure groups in the classification which contains alcohol and tobacco has been completely dropped from the basket. In Sri Lanka alcohol and tobacco are taxed heavily and have tended to increase in price.