Index of Services Production: India's New Monthly Economic Indicator

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The Ministry of Statistics and Programme Implementation (MoSPI) released the first trial Index of Services Production (ISP) for April 2026.
This trial index covers 19 service sub-sectors, which together account for nearly 60% of India's services sector.
The index framework was designed by the Technical Advisory Committee on Index of Services Production (TAC-ISP), which was set up in May 2025.

The Index of Services Production (ISP) serves as India's first high-frequency monthly indicator to measure short-term output volume changes in the formal services sector.
The index uses 2024-25 as its base year, which aligns with the new 2024-based Consumer Price Index series.
It relies on the National Industrial Classification (NIC), 2025 framework to categorize sub-sectors across the economy.
Official data will be published on the 29th of every month with a time lag of about 60 days.
The ISP currently focuses only on the formal services sector, which generates more than 50% of India's GDP.
MoSPI plans to launch a single composite Overall ISP once individual sub-sector data becomes more stable and reliable.
The index design aligns with international standards, including the OECD Compilation Manual for Index of Services Production (2007) and Eurostat guidelines.

Because service sector output is collected in monetary values, MoSPI uses price deflators to remove inflation and calculate actual physical volume.
The Wholesale Price Index (WPI) is used to adjust data for the wholesale trade sector.
Specific sub-sector Consumer Price Indices (CPI) are used for most service categories, while CPI-Services is used when specific indices are absent.
The CPI-General index is applied to banking, insurance, and repair and maintenance services.
This index marks the first time that Goods and Services Tax (GST) outward supply data is used for official government statistics.
Tightly regulated sectors such as Railways, Aviation, Banking, and Insurance rely on administrative and secondary data streams.
The Annual Survey of Incorporated Services Sector Enterprises (ASISSE) provides weighting data and will later help cover non-government health and education sectors.

The inaugural ISP release revealed strong economic momentum, with 14 out of 19 sub-sectors recording double-digit year-on-year growth in April 2026.
The Accommodation & Food sector recorded the highest growth rate at 37.2%.
Retail Trade expanded strongly with a growth rate of 30.8%.
Administrative & Support Services achieved an impressive growth of 28.7%.
Real Estate registered a solid expansion of 27.7%, while Telecommunications grew by 22.8%.
Only two sub-sectors suffered contractions, namely Air Transport at -13.9% and Railway Transport at -0.4%.

The ISP currently excludes core government functions such as public administration, defence, and extraterritorial organizations.
Financial activities outside of regular banking and insurance, including central bank and money market operations, are kept out of the index.
Non-market services such as social work without accommodation, membership organizations, and private households employing domestic help are excluded.
Government-provided health and education services, along with gambling and betting activities, remain outside the current index scope.
These exclusions exist because such activities represent non-market services, direct government administration, or informal dominance where tracking short-term output is difficult.

The traditional Index of Industrial Production (IIP) covers only manufacturing, mining, and electricity, leaving a huge statistical gap in tracking services.
Because services contribute nearly 55% of India's GVA in 2024-25, this monthly indicator will dramatically improve national income and GDP estimates.
High-frequency data enables policymakers and the Reserve Bank of India to detect early economic trends and respond quickly to market changes.
The use of GST and administrative data reduces the survey burden on businesses while delivering faster and more precise economic indicators.