The Ministry of Statistics and Programme Implementation (MoSPI) released the first sub-sectoral Index of Services Production (ISP), aimed at providing a more timely measure of activity in the formal services sector, which accounts for more than half of India’s economic output.
The trial index, based on the 2024-25 base year, covers about 60 per cent of the services sector and tracks monthly movements across areas, including trade, transport, telecommunications, banking, IT services, real estate and hospitality.
The ministry said the index will be published on the 29th of every month, while an overall services production index will be introduced later after assessing the stability of the trial series and expanding coverage.
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Wholesale trade, retail, accommodation and food, road transport, air transport, telecommunications, and banking are among the sub-sectors, covering about 60 per cent of the services sector.
Fourteen of the 19 sub-sectors posted double-digit year-on-year growth in April, with accommodation and food services leading the expansion at 37.2 per cent, followed by retail trade at 30.8 per cent, administrative and support services at 28.7 per cent and real estate at 27.7 per cent.Only railway and air transport posted a decline in April, according to the trial ISP.
“The ISP (Index of Services Production) represents an important milestone in strengthening India’s statistical system and improving the measurement of the services sector, which accounts for more than half of the country’s economic activity,” MoSPI said in a statement.
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Air transport declined by 13.9 per cent, and railway transport was down by 0.4 per cent in April.
Top sub-sectors reporting strong growth in April were ‘accommodation and food’ (37.2 per cent), retail trade (30.8 per cent), administrative and support services (28.7 per cent) and real estate (27.7 per cent), according to the index.
MoSPI said the release of sub-sectoral ISPs will provide, for the first time, a monthly measure of short-term movements in India’s formal services sector, with a coverage of about 60 per cent.
“Based on its data sources, namely, GST and Administrative Data, ISP would cover the formal sector enterprises only.
“Accordingly, services which are not covered in ISP are those which are either related to core government activities or are dominated by non-market activities and the informal sector,” the ministry said.
Subsequent ISPs will be released on the 29th of every month.
Briefing media on the trial ISP release, Chief Economic Adivser V Anantha Nageswaran said there is work ahead…the index measures volumes, but the data arrives as values. So, everything depends on how we adjust for prices.
“Building price indices for services is, of course, not an easy task, as it is the case for goods in general, and that is the most valuable investment we can make, and we will continue to make in producing this index of services production,” he said.
Coverage will widen, with inclusion of health services, education, and own dwelling businesses sub-sectors that increase coverage to 85 to 90 per cent of the formal services sector activity in the economy.
Dilip Singh, Additional General General, MoSPI, said the work is in progress to compile ISP of the sub-sectors, like ‘health and residential care’, education and ownership of dwelling based on administrative data to ensure coverage of more than 80 per cent of the services activities of the economy.
He also said the April data reflects the impact of the West Asia conflict.
The Technical Advisory Committee on Index of Services Production (TAC-ISP), constituted in May 2025, provided the conceptual and methodological guidance on compiling ISP.
On data sources, MoSPI said the ISP adopts a differentiated approach to compilation of sub-sectoral ISPs based on the nature and availability of data sources.
Administrative/secondary data, GST data and Annual Survey of Incorporated Services Sector Enterprises (ASISSE) data are the three principal data sources used in the ISP.