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.