India’s service producer prices showed a sharp divergence across sectors in the first quarter of FY27 (Q1FY27), with air passenger services recording a 31.94% year-on-year increase, while banking service prices remained in deflation, according to provisional estimates released by the government on Monday.
The air (passenger) service price index rose to 126.4 in Q1 FY27 from 106.9 in the fourth quarter of FY26. Its year-on-year inflation stood at 31.94% in the latest quarter, the highest among the seven services covered in the Service Producer Price Index.
The management of pension fund service price index recorded the second-highest year-on-year increase, rising 5.20% in Q1FY27. The index increased to 113.3 from 103.8 in the previous quarter.
Banking service price index rose marginally to 100.9 in Q1 from 100.5 in Q4 FY26, but remained in deflation, with year-on-year inflation at -3.35%, compared with -4.10% in the previous quarter.
In contrast, the banking service contribution index accelerated, with year-on-year inflation rising to 6.90% in Q1 FY27 from 3.30% in Q4FY26. The index increased to 134.8 from 131.5 during the quarter.
The securities transaction service price index declined to 89.9 in Q1FY27 from 91.7 in Q4FY26, with year-on-year inflation turning negative to -1.32%, down from 0.55% in the previous quarter.
The insurance service price index remained unchanged at 102.9, while year-on-year inflation rose marginally to 0.98% from 0.68% in Q4FY26.
The telecom service price index also remained unchanged at 112.2, with year-on-year inflation easing to 0.72% from 0.99%.
Railway service prices increased marginally during the quarter. The railway service price index rose to 103.4 from 103.3, while year-on-year inflation increased to 1.27% from 1.18%.
The railway freight service price Index rose to 103.3 from 103.2, with year-on-year inflation at 0.10%. The railway passenger service price index remained unchanged at 103.5, with inflation holding at 3.50%.
The service producer price indices have been compiled with 2022-23 as the base year. The government said weights have not been assigned to the seven services at the aggregate level as they do not cover the entire services sector. However, sub-service-level weights based on FY23 data have been used to calculate the PPI for each service.
The government has released provisional service PPIs for Q1 and final indices for Q4FY26. Service PPIs for the second quarter of FY27 are scheduled for release on 25 November 2026.
Harsh Kumar is a policy reporter at Mint (HT Media Group), where he covers the Ministry of Commerce and Industry along with key departments of the Ministry of Finance, including the Department of Economic Affairs (DEA) and the Department of Financial Services (DFS). With over five years of experience in business and economic journalism, he has developed strong expertise in tracking policy developments and their wider economic impact.<br><br>He has previously worked with Business Standard, Moneycontrol, and Outlook Money, where he reported extensively on banking, financial services, and the broader economy. Over the years, he has built a reputation for delivering accurate, insightful, and impactful stories, supported by a keen eye for detail and a consistent track record of breaking exclusive news.<br><br>An alumnus of Jamia Millia Islamia, Harsh closely follows regulatory changes and key economic trends shaping India’s financial and industrial landscape. His reporting aims to simplify complex policy issues for a wider audience while maintaining depth and credibility.<br><br>Outside of work, he enjoys tracking policy developments, finding scoops, and travelling, reflecting his curiosity about how economic decisions shape everyday life.
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