The absence of a high-frequency services indicator was a critical gap in India's statistical architecture. Critically examine how the Index of Services Production addresses this gap and what limitations remain.

Services make up about 52.9% of India's GVA (2024-25) [1]. Industry has long been tracked monthly by the IIP, but services had no short-term output measure. NSO-MoSPI's Index of Services Production (ISP) has been released on a trial basis since July 2026, with base year 2024-25. It is a significant but still partial fix.

How ISP addresses the gap

• Frequency and timeliness: It is released monthly with a ~60-day lag, on the 29th of each month [1]. It complements the IIP for tracking business cycles [2].
• Data innovation: GST data is used for statistical purposes for the first time. Administrative data covers air, rail, banking and insurance. ASISSE will later add health and education [2].
• Global alignment: It follows the OECD Compilation Manual for ISP (2007) [1].
• Sub-sector detail: The July 2026 release showed administrative and support services up 20.9% and air transport down 8.4% [4]. Aggregate GVA figures cannot show this kind of detail.

Limitations that remain

• Partial coverage: It covers 19 sub-sectors, ~60% of services [1], and only the formal sector [2]. Firms below the ₹20 lakh GST threshold are left out. Excluded segments make up nearly 33% of services GVA [3].
• Weak deflators: Only five sub-sectors have SPPIs [2]. Most others are deflated with CPI, which includes GST, so a change in GST rates can distort real growth [3].
• Formalisation bias: The "universe approach" counts all GST filers. When an existing business newly registers, it can look like new output [3].
• Interim weights and volatility: Weights within sub-sectors are turnover-based until ASISSE results arrive. Some GST categories are highly volatile, and trial figures may be revised [3].

Way forward

• DPIIT: Produce monthly SPPIs for major services [3].
• Line ministries: Set up monthly reporting systems [3].
• Informal sector: Adapt the IIP committee's method for unincorporated units [3].

Overall, ISP turns a blind spot into a monthly signal, though only for the formal part of services. The TAC rightly judged a trial ISP "more appropriate than continuing without" one [3]. Better deflators, weights and informal-sector coverage can make it a robust basis for evidence-based policy, in line with SDG target 17.18 on timely, reliable data.