Commerce and Industry Minister Anand Sharma on Tuesday proposed the setting up of a Services Competitiveness Council, on the lines of the National Manufacturing Competitiveness Council.
Inaugurating the Services Conclave 2013 here, Sharma highlighted that services trade is an essential ingredient to economic growth, sustainable development and contributes prominently to employment generation.
"India' services sector contributes to around 60 per cent of our GDP, 35 per cent of employment, a quarter of our total trade and more than half of our foreign investment inflows." But, "in a global market of USD 4 trillion of services exports, India's share is still low. It's USD 227 billion," he said.
At the same time, Sharma felt that there is a need to seriously look at how to have a services sector growth which is connected with India's economic philosophy of inclusion and sustainable development.
Adding on, Sharma said "If you have a Joint Task Force between the Government and the Industry, the same the government accepts, and the Task Force will be constituted and we ask both the Commerce Secretary and Rajeev Kher to take this forward along with the CII."
Further, he said: "On the services side, whatever we call it, we accept this proposal which has been made by the industry. I think it is doable."
He further added that "there is a need to look at each vertical of the services sector and focus on that, in a manner that we are able to address the challenges that exist."
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Putting emphasis on the fact that 80 per cent of India's total exports are dominated by the high skilled services including software business services, financial services and communication services, Sharma said "The growth in the service industry verticals has significantly enhanced the number of well paid jobs and have enabled a reallocation of labour to high productivity sectors."
Moreover, Sharma emphasized that while exports from IT and ITES last year stood at Rs. 1.40 lakh crores, registering a growth of over 70 per cent over the previous year, the success witnessed in the IT sector has not been accompanied by concomitant growth in other services industry verticals.
Hence, the minister said "There is a need to adopt a holistic approach to the entire services sector. The challenge is not just to increase the size of the services sector but also to diversify the services basket."
Sharma also felt the need to dwell upon building a robust regulatory framework in the services sector.
"Multiple Ministries and Departments regulate the services sector but few sectors such as construction and retail do not have nodal ministries. Thus there is a need also to map various stakeholders and draw a cohesive roadmap for each of the services sector," said Sharma.
The Services Conclave 2013 will deliberate on a roadmap for augmenting exports of various services so as not only to diversify India's services exports but also to position India as a key player in world services trade.
The conclave is organized by the Department of Commerce in collaboration with the Confederation of Indian Industry (CII) with support from the Federation of Indian Export Organisations (FIEO) and Centre for WTO Studies (CWTOS).
The primary aim of the conclave is to address issues relating to the challenges and opportunities of Services sector exports for India especially in the specific sectors of logistics, professional services (Architectural services, accountancy, management consultancy services), IT/ITeS, telecom services, tourism, health and medical services and creativity and entertainment services.