**Executive Summary**
The Ministry of Statistics & Programme Implementation (MoSPI) has released an approach paper for the compilation of the Index of Service Production (ISP) to monitor the formal services sector's performance. The proposed methodology leverages aggregated GST data to fill a critical data gap in assessing economic activity and short-term movements within the sector. Stakeholders are invited to submit their feedback on the proposed framework via email by the deadline of May 5, 2026.
**Key Points / Main Content**
* **Context and Objectives**
* The services sector contributes more than half of India's GDP, yet there is currently no index equivalent to the Index of Industrial Production (IIP) to track its short-term movements.
* The ISP aims to address a critical data gap that has historically challenged the assessment of overall economic performance.
* The approach paper covers more than 40 sub-sectors, including trade, transport, banking, insurance, communication, real estate, and entertainment.
* **Data Source and Confidentiality**
* MoSPI proposes using aggregated Goods and Services Tax (GST) data from the GST Network (GSTN) as a primary barometer for production and outward supplies.
* To preserve confidentiality, the NSO will utilize aggregated data rather than individual unit-level information.
* The paper outlines the selection of appropriate price deflators and methods to standardize their bases for statistical accuracy.
* **Development and Governance**
* A 24-member Technical Advisory Committee on ISP (TAC-ISP) was constituted in May 2025 to deliberate on the methodology.
* The proposed approach is based on international best practices and extensive analysis of sub-sector data availability and coverage suitability.
**Impact Analysis**
**Experts, Academicians, and Financial Institutions**
**Impact**
These stakeholders are identified as key contributors to the refinement of the statistical methodology. They are impacted by the shift toward a data-driven assessment of the services sector, which will provide more accurate tools for economic analysis.
**Action Required**
Review the proposed approach paper and submit views, comments, or suggestions to ddgec.esd@mospi.gov.in by May 5, 2026.
**Central and State Government Ministries/Departments**
**Impact**
Government bodies are involved in the consultative process to ensure the index aligns with sector-specific dynamics and administrative data sources.
**Action Required**
Provide departmental feedback on the methodology to ensure comprehensive coverage of the sub-sectors under their jurisdiction.
**National Statistical Office (NSO) / MoSPI**
**Impact**
The NSO is responsible for addressing the long-standing challenges of limited data availability by implementing this new framework.
**Action Required**
Analyze stakeholder feedback, finalize the ISP compilation methodology, and ensure the careful analysis of GST data for statistical suitability.
Key Entities Referenced
Index of Service Production (ISP): A proposed economic indicator designed to capture short-term movements in the services sector and address critical data gaps in assessing India's economic performance.
Ministry of Statistics & Programme Implementation (MoSPI): The primary government ministry responsible for the development of the ISP and the issuance of the approach paper for stakeholder consultation.
Technical Advisory Committee on ISP (TAC-ISP): An expert committee constituted to deliberate on compilation methodologies and develop the proposed approach for the ISP based on international best practices.
Goods and Services Tax Network (GSTN): A key data source identified to provide aggregated monthly GST collection data, serving as a barometer for economic activity across various service sub-sectors.
Ministry of Statistics & Programme Implementation
An Approach Paper to Compilation of the Index
of Service Production (ISP) for the formal sector
of the economy
MoSPI invites comments/ feedback from stakeholders on the
Approach
Paper
Posted On: 27 APR 2026 4:25PM by PIB Delhi
The services sector is the most dynamic and rapidly expanding segment of the economy. In terms of
economic significance, the services sector contributes more than half of India's GDP, generates millions of
jobs and has been a major catalyst for the country's economic transformation in the last few decades.
Unlike the Index of Industrial Production (IIP) for the industrial sector, at present, there is no Index of
Service Production (ISP) to capture short-term movements in the services sector. NSO, MoSPI has been
grappling with the issue of compilation of Index of Service Production for quite some time. Due to limited
data availability, the past were met with significant challenges. The unavailability of ISP created a critical
data gap in assessing overall economic performance.
Recent times have seen a huge change in data landscape in India fuelled by data demand, adoption of
technology and digitalization of administrative and secondary data sources. The implementation of the
Goods and Services Tax (GST) in India on July 1, 2017, marked a fundamental shift in economic analysis
as monthly GST collection data acts as a powerful barometer for economic activity. Beyond its primary
goal of taxation, the Goods and Services Tax Network (GSTN) has emerged as a powerful data source for
production and outward supplies across different sectors of the economy.
NSO, MoSPI proposes to use the aggregated GST data to monitor the progress of services sector. MoSPI
does not have access to nor does it require individual unit level data for this purpose, thus preserving the
confidentiality of such dis-aggregated information. However, the data requires careful analysis of its
suitability for statistical purposes. To take this forward, a Technical Advisory Committee on ISP (TAC-
ISP) had been constituted in May, 2025. Twenty four members of the TAC – ISP, over the past year, have
held several deliberations and an Approach Paper on the compilation of ISP for the formal sector has been
prepared. The proposed approach has been developed with reference to international best practices and in
consultation with members of the TAC - ISP.
The approach paper comprehensively analyses more than 40 sub – sectors of the services sector in terms
of availability of data on output and their suitability in terms of coverage. The paper also discusses
availability of most appropriate price deflators and methods to standardize the base of these deflators. The
key sub – sectors covered include wholesale and retail trade, transport, banking, insurance,
communication, hotels and restaurants, real estate, professional, scientific and technical services, arts,
entertainment and recreation, etcMoSPI invites views and comments from experts, academicians, Central government Ministries/
departments, State governments, financial institutions and other stakeholders on the proposed
methodology. The Approach Paper is available on the MoSPI website, can be accessed through the link htt
ps://www.mospi.gov.in/uploads/announcements/announcements_1777286 440613_75065afb-ded9-4c80-b
a5dbdd2fc61f355_Services_sector_approach_paper_final_merged.pdf. It can also be accessed through the
QR code given below. Comments and suggestions may be sent to the email to ddgec.esd@mospi.gov.in by
5th May, 2026.
******
Samrat/Pranab
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