"The economy witnessed a gradual transition from a period of high and variable inflation to more stable and low level of inflation in the last five years," said the survey presented the Finance Minister Nirmala Sitharaman in Parliament on Thursday.

The survey also noted that India's headline retail inflation based on the the Consumer Price Index-Combined (CPI-C) has been on a declining trend for the the last five years. The retail inflation was recorded at 3.4 per cent in 2018-2019, down from 3.6 per cent form the previous fiscal, it added.

"It stood at 2.9 per cent in April 2019 as compared to 4.6 per cent in April 2018. Food inflation based on Consumer Food Price Index (CFPI) declined to a low of 0.1 per cent during the financial year 2018-19," it said.

Referring to wholesale inflation, which is based on the Wholesale Price Index (WPI), the survey said that it remained moderate at 3 per cent in 2017-18 compared to 1.7 per cent in 2016-17, and (-)3.7 per cent in 2015-16 and 1.2 per cent in 2014-15. In the last fiscal 2018-19, WPI inflation, however, rose on year-on-year basis to 4.3 per cent.

The Reserve Bank of India's (RBI) yearly inflation target till 2021 is 4 per cent, in order to achieve macroeconomic stability.

According to the Economic Survey, the current phase of low inflation is also marked by reduction in both urban and rural inflation. It states that the decline in rural inflation is steeper than that of urban inflation since July 2018 resulting in decline in headline inflation.

"Fall in rural inflation is due to moderation in food inflation, which has been negative for last six months (October 2018 to March, 2019)" the survey added.

On the trend in global commodity prices, the survey, quoting the World Bank and Food and Agriculture Organization (FAO), observed that although energy commodity prices rose in the FY 2018-19, food prices recorded fall in prices during the year. WPI-based food inflation too declined during 2018-19 globally, it said.