The Ministry of Statistics and Programme Implementation released trial monthly indices on Tuesday covering 19 service sub-sectors, representing around 60 per cent of the formal services economy. However, the ministry did not release a combined headline measure as part of the initial trial data.
Unlike the manufacturing sector, which is monitored through the monthly Index of Industrial Production and surveys such as the Purchasing Managers’ Index, India currently does not have an official monthly indicator capturing output across its largest economic sector.
“We are hoping that within the next few months we should be able to bring out a headline number also, with or without additional sectors,” Statistics Secretary Saurabh Garg said in an interview late on Thursday.
The Ministry of Statistics and Programme Implementation is evaluating whether to include additional sectors such as health and education before launching the composite index. However, the final timeline will depend on the availability of reliable data from these sectors, Garg said.
He added that the headline index could initially be introduced using the existing 19 sectors, while efforts continue to expand coverage beyond the current 60 per cent of the formal services economy.
The trial data indicated broad-based growth in April, with 14 of the 19 sub-sectors recording double-digit annual growth. Accommodation and food services, retail trade, and administrative services emerged as the leading contributors to growth. Air transport recorded a contraction, while railway transport remained broadly unchanged.
Garg said the monthly services index, along with labour, industrial, and infrastructure indicators, would enhance the government’s ability to evaluate economic activity in real time and improve the compilation of quarterly national accounts.
“I am sure it will help in improving the robustness of the GDP number,” Garg said, highlighting the importance of a dedicated services output measure for improving economic data quality.
The introduction of the headline Index of Services Production is expected to fill a major gap in India’s economic monitoring framework by providing a regular and broader assessment of services sector performance, which plays a crucial role in the country’s overall economic growth.
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