Last updated: Jan, 2022
The services sector in India includes various industries such as healthcare, transport, information technology, business process outsourcing, hotels, restaurants, tourism logistics, transports, and space. In FY21, the sector accounted for ~54% of India’s total gross value added (GVA), a rise from the 51% recorded in FY16.
The service sector also contributes significantly to India’s overall exports. In FY22 (until September 2021), as per the Reserve Bank of India (RBI) data, India’s services exports stood at US$ 135.85 billion, registering a 19.6% YoY growth and amounting to ~37% of the total exports. The growth in exports is driven by key segments such as professional and management consulting services, freight transport services, audio visual related services and telecommunications.
According to Services Export Promotion Council (SEPC) estimates, exports from the services sector are projected to reach >US$ 240 billion in FY22. The growth in exports is also backed by increasing demand among vendors for software services. As per RBI data, total software services exports, including services carried out by foreign affiliates of Indian firms, registered a growth of 2.1% YoY to reach US$ 148.3 billion in FY21.
In 2021, to maximize the potential of the services sector, the government, announced a plan to boost services exports and reach a target of US$ 1 trillion by 2030. To achieve this target, two separate pisions have been established in the Commerce Ministry that will focus on the services sector. The government plans to focus on various service segments such as healthcare, tourism and IT & BPM, to achieve the US$ 1 trillion services exports target by 2030.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.