India To Roll Out New Services Output Gauge, Statistics Secretary Says

India’s statistics authorities are in the final stages of operationalising a dedicated services production index that tracks monthly activity across key segments such as trade, transport, banking, insurance, hospitality, real estate and professional services. Built largely on Goods and Services Tax data and administrative records, the new index aims to bridge a long-standing data gap and improve GDP estimation, policy assessment and market analysis of the services-led Indian economy.

New Barometer For A Services-Led Economy

The upcoming ISP will act as a services counterpart to the IIP, capturing short-term movements in a sector that contributes more than half of India’s GDP and supports millions of jobs. Initially released with a short time lag, the index will help refine quarterly and advance national accounts estimates by adding a robust services indicator to the existing macro toolkit.

Methodology And Data Architecture

According to the statistics ministry’s approach paper, ISP compilation will rely primarily on GST Network returns as proxies for turnover, supplemented by administrative data from sectoral regulators and the Annual Survey of Incorporated Services Sector Enterprises. Different price deflators, including service producer price indices, consumer price indices and other sectoral measures, will be used to derive real growth across sub-sectors, with 2024-25 proposed as the base year.

What It Means For Policy And Markets

For policymakers, the new services output index promises sharper insight into cyclical shifts, aiding more timely decisions on fiscal and monetary responses. For analysts and investors, it should improve tracking of India’s services momentum, sector rotation and employment trends, enhancing macro forecasts and market strategies tied to the services economy.

Key Highlights

1. New Index of Service Production to be launched by next month to track services output monthly
2. Index to complement Index of Industrial Production and improve GDP estimation quality
3. Coverage to include trade, transport, banking, insurance, hospitality, real estate and professional services
4. Methodology anchored in GST data plus administrative and survey-based datasets
5. Base year proposed as 2024-25 with sector-specific price deflators for real growth measurement

Sources: Ministry of Statistics and Programme Implementation consultation papers and media reports on the proposed Index of Service Production