In News:

The Ministry of Statistics and Programme Implementation (MoSPI) has released the first trial Index of Services Production (ISP) for 19 services sub-sectors for April 2026. It is India's first monthly indicator to measure short-term performance of the formal services sector.

About the Index of Services Production (ISP)

The Index of Services Production (ISP) is a monthly economic indicator that measures changes in the volume of output in India's formal services sector, which contributes more than 50% of India's GDP. It seeks to complement existing indices such as the Index of Industrial Production (IIP) by providing high-frequency data on the services sector.

The trial ISP has 2024–25 as its base year and is compiled using the National Industrial Classification (NIC), 2025. At present, it covers 19 sub-sectors, accounting for about 60% of the services sector, while core government services, non-market activities and the informal sector remain outside its scope.

Methodology

The conceptual and methodological framework for the ISP was developed by the Technical Advisory Committee on Index of Services Production (TAC-ISP), constituted in May 2025.

The index follows a hybrid data model by using:

• GST data for market-driven service sectors.
• Administrative data for regulated sectors such as Railways, Air Transport, Banking and Insurance.
• Annual Survey of Incorporated Services Sector Enterprises (ASISSE) for assigning sectoral weights.

To estimate real output, nominal values are deflated using:

• Wholesale Price Index (WPI) for wholesale trade.
• Sub-sector-specific or proxy Consumer Price Indices (CPI) for most service sectors.
• CPI-General for repair services, banking and insurance.

Key Highlights (April 2026)

The inaugural release indicates strong growth in the services sector, with 14 out of 19 sub-sectors recording double-digit year-on-year growth.

The fastest-growing sectors were:

• Accommodation & Food: 37.2%
• Retail Trade: 30.8%
• Administrative & Support Services: 28.7%
• Real Estate: 27.7%

Only Air Transport (-13.9%) and Railway Transport (-0.4%) registered negative growth during the period.

Future Roadmap

• Sub-sectoral ISP will be released every month on the 29th.
• A composite Overall ISP will be introduced after sufficient improvement in data coverage, stability and resilience of the individual sub-sector indices.

In News:

The Ministry of Statistics and Programme Implementation (MoSPI) is set to launch the Index of Services Production (ISP) in July 2026. The new index is expected to become India's first high-frequency indicator for measuring the performance of the services sector, similar to the Index of Industrial Production (IIP) for industry.

About the Index of Services Production (ISP)

The Index of Services Production (ISP) is a short-term economic indicator that measures changes in the real output of service-producing industries over time relative to a specified base year. It is being developed with 2024–25 as the proposed base year and will primarily use Goods and Services Tax (GST) data to capture economic activity in the formal services sector.

The objective of the ISP is to provide timely information on the growth and performance of India's services sector, which contributes the largest share to the country's Gross Value Added (GVA). The index is expected to improve short-term economic assessment and strengthen evidence-based policymaking.

Data Sources

The ISP will draw information from multiple administrative and statistical databases to ensure comprehensive coverage of service-sector activities.

Its principal data sources include:

• Administrative data for sectors such as air transport, railways, banking, and insurance.
• GST data for wholesale and retail trade, hospitality, road and water transport, warehousing, telecommunications, real estate, information technology services, professional services, and entertainment.
• Annual Survey of Incorporated Services Sector Enterprises (ASISSE) data for health and education services, which will be incorporated in subsequent phases.

Since the index is largely based on GST-registered enterprises, it will primarily reflect the performance of the formal services sector.

Key Features

• Base Year: 2024–25.
• Developed by the Ministry of Statistics and Programme Implementation (MoSPI).
• Measures changes in the volume of output rather than price changes.
• Sectoral weights are assigned based on each sector's contribution to Gross Value Added (GVA) as reported in the National Accounts Statistics (NAS).
• Designed to complement existing indicators such as the Index of Industrial Production (IIP) and national income estimates.