Govt releases first services production index; 14 of 19 sub-sectors post double-digit growth
The government on Tuesday released the first trial Index of Services Production (ISP), showing that 14 of the 19 formal services sub-sectors recorded double-digit year-on-year growth in April.The trial index, with 2024-25 as the base year, covers about 60 per cent of India’s services sector through sub-sectors such as wholesale and retail trade, accommodation and food services, road and air transport, telecommunications, and banking.According to the ministry of statistics and programme implementation (MoSPI), all sub-sectors except railway transport and air transport registered positive annual growth in April. Air transport contracted 13.9 per cent, while railway transport declined 0.4 per cent. “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,” said the ministry.Among the fastest-growing segments were accommodation and food services, which expanded 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.The Index of Services Production (ISP) is a monthly indicator that measures the output of India’s formal services sector, much like the Index of Industrial Production (IIP) tracks manufacturing and industrial activity.Describing the ISP as a milestone in India’s statistical system, MoSPI said the index provides, for the first time, a monthly measure of short-term movements in the country’s formal services sector, which contributes more than half of India’s economic activity.The ministry said the index is compiled using GST and administrative data and therefore covers only formal sector enterprises. Services linked to core government functions or dominated by the informal and non-market sectors are not included in the index. “”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 added.MoSPI added that the Index of Services Production will be released on the 29th of every month going forward.
