Service sectors ppt

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service sector in india

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Service sectors ppt

  1. 1. Service Sector Contribution to Indian Economy
  2. 2. Services A type of economic activity that is intangible, is not stored and does not result in ownership. A service is consumed at the point of sale. Services are one of the two key components of economics, the other being goods.
  3. 3. Various types of Service
  4. 4. GDP Gross domestic product (GDP) refers to the market value of all final goods and services produced within a country in a given period. GDP per capita is often considered an indicator of a country's standard of living.
  5. 5. Contribution of Various Sectors towards GDP Source: Databook, Planning Commission, Government of India (July 3 2014
  6. 6. • 59 per cent share in gross domestic product (GDP) in 2013- 2014 • Growth by 9 per cent annually (2013-2014) • Contributing to about a quarter of total employment (26.8%) • Accounting for a high share in foreign direct investment (FDI) inflows and over one-third of total exports • 7th largest service exporter in the world [Source: indiabudget.nic.in] Service Sector in India
  7. 7. Service Sector performance of top 11 Countries
  8. 8. Comparative Growth of Various Sectors Growth rates of modern sectors like manufacturing, Financial, real estate, professional services, etc. is increasing remarkable and traditional sectors tend to decline.
  9. 9. Services Classification in Indian Economy • Trade, Hotels and Restaurants • Transport storage and Communication • Finance, Insurance, Real Estate and Business Services • Community, Social and Personal Services • Construction
  10. 10. Share and Growth of India’s Service Sector at Factor Cost
  11. 11. Share and Growth of India’s Service Sector at Factor Cost • CAGR @ 6.8% (2013-14) has declined due to deceleration in the growth rate of Trade, Hotels and Restaurants and Transport, Storage and Communications • Finance, Insurance, Real Estate and Business Services has shown a robust growth of 12.9%. • Substantial growth in sub-sectors like banking & insurance (11.8%), real estate, ownership of dwelling and business services (10%), Hotels & Restaurants (0.5%) and Railways (0.3%)
  12. 12. State wise Contribution towards Service Sector
  13. 13. State wise Contribution towards Service Sector • Service sector is dominant in most of the states of India • In the Share of GSDP, states and Union Territories like Chandigarh, Delhi, Kerala, Mizoram, West Bengal, , Tamil Nadu, Maharashtra, Nagaland, Tripura and Karnataka have higher share than all - India share. • Chandigarh and Delhi at 86.9% and Mizoram at 66.1%
  14. 14. Trade, Hotels & Restaurants • Includes services like Wholesale, Retail, E-Commerce, Accommodation and Food and Beverages • This sector has attracted maximum FDI (2001-2014) amounting to US$ 41,755.46 million (18% of total FDI Flow) (According to Department of Industrial Policy and Promotions) • Companies like Zomato, Snapdeal, FoodPanda are expanding in a large scale • E-Commerce sector is expected to give jobs to 150000 people within the next 2-3 years
  15. 15. Transport, Storage and Communications • Includes local transport, tourism, Postal and courier services, Space transport services like railway, waterways, roadways & airways • Ola cabs plans to scale up operations to 100 cities from 19 cities • Aviation sector has signs for revival with new players like Air Asia and Tata- SIA entering the market • FDI policy in railway are proposed to be revised to encourage more FDI in rail and to foster creation of world class rail infrastructure • Tourism has seen steady growth from 4.45 million arrivals in 2006 to nearly 7 million in 2013
  16. 16. Finance, Insurance, Real Estate & Business Services • Includes banking and financial services, insurance , Rent & Lease of property, machinery, tools, software, etc. R&D, Legal and Accounting services, Tax, consultancies, PR, Advertising & Media, management services, architectural services, Engineering, designing, telecommunication, etc. • Entertainment & Media sector is projected to grow @ 14.2 per annum in 2018. • Business processing and IT Sectors are one of the fastest growing sectors in India (10.3% in 2013-14) • Logistics sector valued at US$ 101 billion is expected to grow @ 10% per annum • Mobile services revenue is expected to touch US$37 billion in 2017 growing @ 5.2% annually
  17. 17. Performance of IT & ITeS
  18. 18. Service Sector Performance in India
  19. 19. Construction • Construction attracts FDI of US$1226 millions in 2013-14 contributing to 11% of total share • Sector is growing by 1.6% in2013-14. Expected to grow further
  20. 20. Community, Social & Personal Services • Includes government services like administrative, defense, legislative, social security, etc. Religious Services, service of artists, authors, sportsmen, beauty and physical wellness, education, healthcare and medical, etc. • This sector grew @ 5.6% in 2013-14 and it is expected to grow @ 9.1% in 2015
  21. 21. Service Sector Performance in 2015
  22. 22. Issues in service sector • Nodal Agency and promotion for services • Disinvestment • Collateral free soft loan credit needs • Revision and amendment of tax, trade policies and laws related to services • Investment in Infrastructure development for delivering better service
  23. 23. Road Ahead • Improvement in global growth and recovery in industrial growth will drive the services sector to grow 7.4 per cent in FY16 • Loss of growth momentum in commodity-producing sectors had adversely impacted transport and storage sectors over the past two years, this is expected to change in FY16 • The financing, insurance, real estate and business services sectors are also expected to continue their good run in FY16 • With urbanization of many small villages and towns, construction sector is about to see tremendous growth potential • Mobile services revenue is expected to touch US$37 billion in 2017 growing @ 5.2% annually
  24. 24. Thank You

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