Overview
India is launching the Index of Services Production (ISP) in July 2026, a monthly measure tracking services sector growth. With 2024-25 as the base year, the ISP will use GST and survey data to provide timely insights. It will fill a critical gap by complementing the Index of Industrial Production (IIP).
A New Chapter in Economic Monitoring
India's economy is changing fast. The services sector now drives much of the growth. But until now, there was no monthly measure to track how this sector is performing. That changes in July 2026.
The Ministry of Statistics and Programme Implementation (MoSPI) is launching the Index of Services Production (ISP). This new monthly indicator will measure short-term changes in the services sector. It will work like the Index of Industrial Production (IIP), which tracks factory output.
For years, policymakers had to rely on quarterly data. They could not see monthly trends. The ISP will change that. It will give a clearer and more timely picture of the economy.
What Is the Index of Services Production (ISP)?
The ISP is a high-frequency economic indicator. It measures changes in the volume of output produced by service industries over time. It tracks the real growth of services relative to a fixed base year.
The base year for the ISP is 2024-25. The first trial indices will be released on July 14, 2026. These will cover the period of 2025-26 and April 2026.
After that, the ISP will be published every month. It will come out on the 29th of each month. There will be a lag of about 60 days. This means the index for May 2026 will be released in July 2026.
The ISP is designed to capture short-term movements in the services sector. It will show how different service industries are performing. This will help policymakers, businesses, and economists understand the economy better.
Why Does India Need an ISP?
The services sector has been the largest part of India's economy since 2013-14. It contributes more than half of the country's Gross Value Added (GVA). In fact, services now account for over 53 per cent of GVA.
Despite this, India did not have a monthly indicator for services. Policymakers relied on quarterly estimates and indirect indicators. This made it hard to spot trends quickly.
The ISP will fill this gap. It will provide timely information on service sector performance. It will help monitor economic growth more effectively. It will also improve policy formulation and economic forecasting.
The ISP will also support national accounts and research. It will give statisticians better data to work with. This will make India's economic statistics more transparent and reliable.
Key Objectives of the ISP
The ISP has two main primary objectives.
Tracking Economic Trends
The ISP will complement the IIP. Together, these indicators will give a broader picture of economic activity. They will help assess short-term movements in the economy.
This is important because the services sector and industrial sector often move differently. Having both indicators will show the full picture.
Strengthening Statistical Infrastructure
The ISP will offer high-frequency data on service industries. This will improve the quality of economic analysis. It will support evidence-based policymaking.
Better data leads to better decisions. The ISP will help India build a stronger statistical system.
Which Sectors Will Be Covered Under the ISP?
The ISP will cover a wide range of formal service industries. These sectors contribute significantly to India's economy.
Major sectors include:
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Wholesale and retail trade
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Transport services
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Banking and insurance
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Telecommunications
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Hotels and restaurants
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Real estate activities
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Professional, scientific and technical services
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Information technology and computer services
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Administrative and support services
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Arts, entertainment and recreation
These sectors represent a substantial share of India's formal services economy. They will help create a comprehensive picture of service sector growth.
Which Sectors Will Not Be Included?
Some services are excluded from the initial ISP framework. These are mostly government activities or informal operations.
Excluded sectors include:
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Public administration and defence
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Government health services
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Government education services
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Social work activities without accommodation
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Personal services
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Activities of private households with employed persons
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Gambling and betting activities
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Some financial services beyond banking and insurance
Health and education services provided by private companies will be included later. This will happen through survey-based estimates.
How Will the ISP Be Compiled?
MoSPI will use the Fixed-Weight Laspeyres Volume Index methodology. This is a globally accepted statistical method for measuring output changes.
Data Sources
The ISP will rely on three key data sources.
1. Administrative Data
Administrative records will be used for sectors like air transport, railway transport, banking, and insurance. These sectors have well-established data systems.
2. GST Data
The Goods and Services Tax (GST) system is the most important data source. GST returns contain information about service transactions. These are classified using Service Accounting Codes (SACs). These can be mapped to industry classifications.
Since services are consumed soon after production, turnover data is a reliable indicator of actual output.
GST data will support indices for wholesale and retail trade, telecommunications, accommodation and food services, road transport, warehousing, real estate, IT services, professional services, and administrative support services.
3. ASISSE Data
The Annual Survey of Incorporated Services Sector Enterprises (ASISSE) will provide data for health and education services. These sectors are exempt from GST. They need alternative data sources.
Why Was ISP Difficult to Compile Earlier?
Creating a services production index has always been challenging. Services are different from manufactured goods.
Major obstacles included:
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Lack of reliable high-frequency service sector data
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Limited administrative records
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Difficulty measuring intangible outputs
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Absence of suitable service-sector price indices
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Wide diversity of service activities
Unlike factories that produce measurable goods, many services do not have easily observable output quantities. This made statistical measurement more complex.
What Has Changed in Recent Years?
Several developments have made the ISP possible today.
GST Implementation
The GST has generated large volumes of structured data on service transactions. This data is detailed and reliable.
Better Administrative Information
Government agencies now have better-quality administrative information. This is true for banking, insurance, railways, and aviation.
Launch of ASISSE
The Annual Survey of Incorporated Services Sector Enterprises provides reliable estimates for sectors not covered through GST.
These improvements have strengthened India's statistical ecosystem. They have enabled the creation of the ISP.
Understanding the Role of GST Data
GST data is central to the ISP framework. Businesses registered under GST file returns with information about outward supplies of goods and services.
These transactions are classified using Service Accounting Codes (SACs). These codes can be mapped to National Industrial Classification (NIC) codes.
Since services are consumed soon after production, turnover