Inflation rose to 6.95% in February because of sharp increase in food prices, especially vegetables and protein-based items.
Inflation, as measured by the Wholesale Price Index (WPI), was 6.55% in January.
In February last year, it was 9.54%.
As per the official data released today, food inflation was 6.07% in February against (-)0.52% in January.
Pulses turned expensive by 7.91% and vegetables by 1.52% during February. Prices of vegetables had declined by 43.13% in January.
Besides, egg, meat and fish prices rose 20% during the month, from 18.63% in January.
Milk became expensive by 11.70%, while rice and cereals turned costlier by 1.53% and 1.71% respectively.
However, prices of potato and onion declined by 2.22% and 48.50% year-on-year in February.
Food articles have 14.3% share in the WPI basket.
Prices of manufactured items, which have a weight of around 65% in the WPI basket, went up by 5.75% year-on-year in February, as against 6.49% in the previous month.
The headline inflation numbers for December was revised upwards to 7.74%, from the provisional estimate of 7.47%.
Inflation in manufactured items has been high since February 2011, when it crossed the 6% mark.
Among manufactured items, iron grew dearer by 15.82% and edible oil prices rose by 7.57%, year-on- year. The cost of tobacco products moved up by 10.10% and basic metals became 10.44% expensive.
Inflation in overall primary articles was 6.28% in February on annual basis. It was 2.25% in January.
Non-food primary articles, which include fibres and oilseeds, showed moderation to (-)2.56% in February. In January, inflation was 0.55%.
Inflation in the fuel and power segment was 12.83% on an annual basis. The rate of price rise was 14.21% in the previous month.
Experts said the rise in inflation, driven by prices of food articles, will keep the pressure on the government to remove supply side bottlenecks.
Headline inflation was near double digit for most of 2010 and 2011. The apex bank hiked key policy rates 13 times, totalling 350 basis points between March 2010 and October 2011 to tame inflation.
Although RBI has resorted to injecting liquidity of Rs 48,000 crore into the financial system, by reducing Cash Reserve Ratio for banks, it has also called for fiscal steps by the government to combat inflation.