Service Sector in India The Service Sector, also

Transcript:Service Sector in India The Service Sector, also:
Service Sector in India The Service Sector, also called tertiary sector, is the third of the three traditional economic sectors. The service sector produces intangible goods, more precisely services instead of goods, Activities in the service sector include retail, banks, hotels, real estate, education, health, social work, computer services, recreation, media, communications, electricity, gas and water supply.[1] The services sector, with around 60 per cent contribution to the Gross Domestic Product (GDP) in 2014-15, has made rapid strides during the past decade and a half to emerge as the largest and one of the fastest-growing sectors of the economy. The services sector is not only the dominant sector in India’s GDP, but has also attracted significant foreign investment flows, contributed significantly to exports as well as provided large-scale employment. Composition of Service Sector in India In India, the national income classification given by Central Statistical Organization is followed. In the National Income Accounting in India, service sector includes the following: 1. Trade, hotels and restaurants: a. Trade b. Hotels and restaurants 2. Transport, storage and communication a. Railways b. Transport by other means c. Storage d. Communication 3. Financing, Insurance, Real Estate and Business Services a. Banking and Insurance b. Real Estate, Ownership of Dwellings and Business Services 4. Community, Social and Personal services a. Public Administration and Defense (PA & D) b. Other services Role of Service sector in India Share in Net National Product: At present, the service sector contributes the maximum share in country’s net national product at factor cost (national income). According to 2000-01, 48.5 % share of national income comes from service sector and moreover, 22.9% of total working population are employed in this sector. (ii) Helps Industrialisation: The development of industries is dependent on the performance and improvement of transport, communication, electricity, banking etc. in a country. Transport system helps to carry raw materials, finished goods and labourers in their required destination. Communication helps to widen the market industrial goods. Electricity and banking services help to flourish the industries in remote areas. (iii) Expands Agriculture: Service sector helps to develop the agricultural production by providing better network facilities. It helps to carry raw materials and finished goods from one place to another. (iv) Removes Regional Imbalances: This sector provides a well-organised transport and communication service. It also provides sufficient banking services along with expansion of education and medical facilities in the backward regions of