First Release of Sub-Sectoral Trial Index of Services Production (ISP) (Base Year 2024-25)
Key Points
The Ministry of Statistics and Programme Implementation (MoSPI) has released the first trial Index of Services Production (ISP) for April 2026, marking a significant milestone in measuring the performance of India's services sector. This is crucial for UPSC aspirants, particularly for General Studies Paper 3, which covers economic development. Last Updated: 15-07-2026
Key Facts About the Index of Services Production (ISP)
- The trial ISP uses 2024–25 as its base year, based on the National Industrial Classification (NIC), 2025.
- The ISP is India's first monthly indicator for measuring short-term movements in the formal services sector, contributing over 50% of the GDP.
- Excludes core government services, non-market activities, and the informal sector.
- Designed by the Technical Advisory Committee on Index of Services Production (TAC-ISP), constituted in May 2025.
- Utilizes a deflation mechanism using the Wholesale Price Index (WPI) and Consumer Price Indices (CPI) for accurate measurement.
- Relies on a hybrid data model, leveraging GST data and administrative/secondary data.
- In April 2026, 14 out of 19 sub-sectors recorded double-digit growth, with Accommodation & Food leading at 37.2%.
- Sub-sectoral indicators will be released monthly on the 29th.
India's Services Sector Growth
The release of the ISP is a pivotal development in enhancing India's economic indicators. The services sector, contributing over half of India's GDP, is crucial for economic growth and strategic planning. This index aligns with India's goals of improving economic assessments and providing reliable insights into sectoral performance, fostering better policy-making and international competitiveness.
UPSC Relevance
The release of the ISP is relevant for UPSC General Studies Paper 3, focusing on economic development. In the prelims, questions may revolve around the definition, base year, and scope of the ISP. For mains, candidates could explore themes like the impact of accurate service sector measurement on economic policy and planning. The topic also connects to essays on economic reforms and statistical advancements.
FAQ Section
- What is the Index of Services Production (ISP)?
The ISP is a monthly indicator designed to measure short-term movements in India's formal services sector, using 2024-25 as its base year. - Why is the ISP important?
The ISP provides a more accurate and timely measure of the services sector's performance, which is essential for economic planning and policy-making. - What are the key features of the ISP?
The ISP uses a hybrid data model, deflation mechanisms, and covers the formal services sector, excluding informal and non-market activities.
Detailed Coverage
- Base Year: 2024-25 for the trial Index of Services Production (ISP).
- Scope: Monthly indicator for formal services sector, over 50% of GDP.
- Methodology: Designed by the Technical Advisory Committee on ISP (TAC-ISP).
- Deflation: Uses Wholesale Price Index (WPI) and Consumer Price Indices (CPI).
- Data Sources: Hybrid model using GST data, administrative data, and ASISSE data.
- Growth Trends: 14 out of 19 sub-sectors showed double-digit growth in April 2026.
- Highest Growth: Accommodation & Food (37.2%), Retail Trade (30.8%).
- Negative Growth: Air Transport (-13.9%), Railway Transport (-0.4%).
- Release Frequency: Sub-sectoral indicators on the 29th of each month.
- Overall ISP: Composite index to be introduced later.
- Significance: Enhances measurement of services sector performance.
- Committee Composition: Includes academia, industry associations, and government representatives.
- Monthly and Annual Growth Rates: Provided in additional annexures.
- Data Classification: Based on NIC, 2025 for comprehensive economic activity classification.
- Salient Features: Focuses on formal sector enterprises.