India's first ISP data: Hotels, retail drive services growth in April

The trial Index of Services Production offers a monthly snapshot of India's services economy, with hotels, retail, and administrative services leading growth in April

The Ministry of Statistics and Programme Implementation (MoSPI) has released the country's first trial Index of Services Production (ISP), which tracks output across the formal services economy. The data for April 2026 shows that accommodation and food services recorded the strongest annual growth at 37.2 per cent, while retail trade, administrative services, and real estate also posted robust gains.

 

The new index is expected to become a key high-frequency indicator for India's services sector, much like the Index of Industrial Production (IIP) tracks for manufacturing. Since services account for more than half of India's economic activity, the ISP is expected to provide policymakers, businesses, and investors with a clearer picture of economic momentum.

 

 

Hotels, retail, and real estate drive growth

 

The first trial release covers 19 formal service sub-sectors, representing around 60 per cent of the services economy. Out of these, 14 sectors recorded double-digit year-on-year growth in April, highlighting strong momentum across much of the formal services landscape.

 

The fastest-growing sectors were:

 

• Accommodation and food services: 37.2 per cent
• Retail trade: 30.8 per cent
• Administrative and support services: 28.7 per cent
• Real estate: 27.7 per cent
• Telecommunications: 22.8 per cent

 

Other sectors, including wholesale trade, road transport, warehousing, banking, insurance, IT services, professional services, and arts and recreation, also reported healthy gains.

 

The growth story had a few exceptions

 

Air transport contracted 13.9 per cent in April compared with the same month last year, while railway transport slipped 0.4 per cent. Reports suggest the sharp decline in air transport could be linked to elevated airfares amid higher aviation fuel costs following tensions in West Asia.

 

Meanwhile, water transport, postal and courier services, and information and broadcasting continued to expand at a moderate pace.   

 

How the index will evolve

 

The ISP is currently being released as a trial series as the government fine-tunes its methodology before introducing a full-fledged services production index.

 

Speaking on the launch, MoSPI Secretary Dr Saurabh Garg said the ministry would continue to seek feedback from stakeholders to further strengthen the ISP and enhance India's statistical ecosystem.

 

Chief Economic Advisor Dr V Anantha Nageswaran said the index's coverage would expand over time with the inclusion of sectors such as health services and ownership of dwellings, taking its coverage to around 85-90 per cent of the formal services sector's contribution to the economy.

 

MoSPI said the trial ISP will be released on the 29th of every month, providing regular insights into the performance of the formal services sector as the index evolves.