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The Indian Service Sector

The service sector plays a very important role in enabling and nurturing the socio-economic development of any country. India has a unique advantage that even though English is not the mother language of this country, it is a commonly spoken language across the entire nation and is commonly used in personal and official communication. So, there is a very large population of English speaking individuals available to engage in the service industry. This puts India in a very advantageous position opening newer doors for growth in the service sector.

India therefore stands out from the rest of the world and the Indian service sector has emerged as the fastest-growing sector in the Indian economy, making a significant contribution to the county's job market by generating sizable employment and by creating an opening to absorb the large population of youth in this young country.

The growth rate of the Indian service sector has now surpassed that of the manufacturing and agro sectors. With a growth rate as high as 10+% per year, the contribution of the services sector to the Indian economy has been significant and holds nearly 60% share in India's GDP. Almost 25% of the jobs generated in India is attributed to the service sector. Due to the new opportunities of outsourcing by foreign countries, several BPOs and other businesses have emerged making the service sector also a significant contributor to exports and foreign currency inflow.

The service sector encompasses a wide gamut of activities, included but not limited to - trading, tourism, hotels & restaurants, transportation, shipping & port services, storage services, telecommunication services, financial, accounting and auditing services, real estate, business services, research and development, health care, community, social, personal services, and information technology services.

Share of GDP by various activities in the Indian Service Sector

Service Sector Share of GDP


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About the Author

Rajeev Kumar
CEO, Computer Solutions
Jamshedpur, India

Rajeev Kumar is the primary author of How2Lab. He is a B.Tech. from IIT Kanpur with several years of experience in IT education and Software development. He has taught a wide spectrum of people including fresh young talents, students of XLRI, industry professionals, and govt. officials.

Rajeev has founded Computer Solutions & WebServicesWorldwide.com, and has hands-on experience of building variety of web applications and portals, that include - SAAS based ERP & e-commerce systems, independent B2B, B2C, Matrimonial & Job portals, and many more.

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