The country's annual consumer price inflation slowed slightly in July to 9.86%, helped by a drop in petrol prices at the pump, government data showed on Tuesday, but a drought in parts of the country pushed food prices higher.
India has the highest retail inflation among the BRICS group of emerging economies - Brazil, Russia, China, and South Africa - and is way above what the Reserve Bank of India (RBI) calls its comfort level.
RBI's next policy review will be on September 17.
Food prices for consumers accelerated to 11.53 in July from 10.71% in June.
Inflation as measured by the country's benchmark wholesale price index dropped to 6.87% in June, nearly three-year low, helped by slower increases in fuel prices, data on August 14 showed.
Unlike most central banks, the Reserve Bank of India mainly uses the wholesale price index for monitoring inflation. Annual consumer price inflation data was only launched in 2011.