India's services sector accounts for over half its GVA but has historically lacked a high-frequency output indicator. Examine how ISP addresses this gap and the challenges in capturing the informal services economy.

Services have contributed over 50% of India's GVA since 2013-14, yet the sector lacked a monthly output gauge comparable to the Index of Industrial Production (IIP) for industry [2]. MoSPI's first Index of Services Production (ISP), released on 14 July 2026 with base year 2024-25, fills this long-standing statistical gap [1].

How ISP addresses the gap

• High-frequency tracking: monthly release (29th of each month, ~60-day lag) enables real-time reading of services output, complementing IIP and GDP estimates [2].
• Robust methodology: a fixed-weight Laspeyres volume index with GVA-based weights; base year aligned with the new CPI (2024) for deflator consistency [2].
• Multi-source architecture: administrative data (air/rail, banking, insurance), GST outward-supply data (trade, telecom, real estate), and survey data (health, education) [2].
• Wide coverage: 19 sub-sectors (~60%) of formal services, with a phased path to an eventual overall ISP [1].
• Sharper policy calibration for monetary and fiscal decisions given services' dominance [2].

Challenges in capturing the informal economy

• Formal-only scope: informal services—a large share of services employment—are excluded, limiting representativeness [2].
• Data-source bias: reliance on GST and administrative records inherently misses unregistered enterprises [2].
• Government health/education and gambling also remain outside coverage [2].

ISP marks a decisive step in modernising India's statistical architecture. Extending coverage to informal services, in line with NITI Aayog's data-strengthening agenda, would make it a truly holistic barometer of the services economy.