The Central Statistics Office (CSO) data showed that inflation in food basket rose to 0.3 per cent in March from (-) 0.66 per cent in the previous month.
The inflation in 'fuel and light' segment rose to 2.42 per cent as against 1.24 per cent in February.
The retail inflation stood at a nine-month low of 1.97 per cent in January.
A Reuters poll had predicted that retail inflation could inch up to 2.80 per cent in March but will remain under the Reserve Bank of India’s (RBI's) medium-term target of 4 per cent.
"A modest rise in (retail) inflation was on the cards. Some sequential pick-up in food is expected in the summer months. What's comforting is that inflation still remains within the targeted range of the RBI and in line with the trajectory outlined by the central bank," Tushar Arora, senior economist, HDFC Bank told news agency Reuters.
In another set of data released by the government, factory output growth or industrial production slowed to 0.1 per cent in the month of February amid slowdown in the manufacturing sector.
Factory output, measured in terms of the Index of Industrial Production ( IIP) had grown by 6.9 per cent in February last year.