The government is planning to tap the potential of services and export them, even as it work to turn India into a manufacturing hub.
The commerce department has joined hands with the Confederation of Indian Industry (CII) to organise an exhibition of services in April, where 40 countries are expected to participate.
Besides, the government is working on reforms in areas such as legal, healthcare, and education services and will soon finalise a Cabinet note on that.
"A couple of years ago, we constituted an inter-ministerial entity for identifying and working on reforms which are required in various services areas in terms of legislation, practice, procedures, etc," commerce secretary Rajeev Kher said.
That process has worked to a point now, he added.
"We are rolling out consultation at the inter-ministerial level and the committee of secretaries and then obviously we will take it to the logical Cabinet decision."
Kher said the government is working on reforms "with the whole intention of making them more competitive."
He added: "We have broken good ground. Now we are working on legal services, we are working on educational services, we are working on healthcare services areas and therefore both the things are happening at same time."
India has implemented several free trade agreements in goods and services, but services exports still face issues related with mutual recognition agreements.
On the other hand, foreign professionals in legal and accountancy services can't work in India. Against this backdrop, the Prime Minister is slated to inaugurate a three-day global exhibition on services, beginning April 23.
Commerce and industry minister Nirmala Sitharaman said the government wants to give equal importance to services along with manufacturing.
"Is services sector being promoted at the cost of manufacturing. No. We see synergy between the two," said the commerce secretary,
The government intends to lay focus on sectors such as IT and telecom, education, healthcare, logistics, media and entertainment, professional services, tourism, space, research and development, Kher told a press conference here.
To a query, Sitharaman said the Department of Ayush is looking at setting standards for Ayurveda and other indigenous medicinal systems, she clarified that there cannot be a uniform kind of norms for these systems as there are different branches of the traditional knowledge.
Kher said that share of India's services sector in the global services trade is only three per cent as compared to 4.6 per cent of China, despite the tertiary sector contributing 57 per cent of the country's gross domestic product.
"This clearly reflects that huge potential is there for India to tap," he said.
However, India's rank has improved from 11th in 2009 to sixth in 2013 in global exports of services.
Kher said services sector will also have to play an important role in Make in India programme since there are embedded services in the manufacturing sector which constitute 50 per cent of it.
"Unless we are competitive in services, we will not be competitive in merchandise," he said.
Make in India programme also has some services such as tourism and wellness.
To a query as to what will be the government's policy when fresh applications came for FDI in multi-brand retail and if the exiting player (Trent Hypermarket) wants to open more stores, Sitharaman said, "I will answer when these come."
India's services exports are $73 billion more than the imports in 2013-14. India had a trade surplus in services segment unlike in merchandise where India runs a huge trade deficit of $138 billion in 2013-14. It is important to boost services exports to finance the trade deficit or narrow down the current account deficit.
