The services sector, which accounts for 54 per cent of India's gross value added (GVA), witnessed a growth rate moderated to 7.5 per cent in 2018-19 as compared to 8.1 per cent in 2017-18, says the Economic Survey 2018-19 report which Finance and Corporate Affairs Minister Nirmala Sitharaman tabled in Parliament on Thursday.
While segments like tourism, trade, hotels, transport, communication and services related to broadcasting, public administration and defence saw deceleration, financial, real estate and professional services category accelerated.
The Survey says that India received 10.6 million foreign tourists in 2018-19 as compared to 10.4 million in 2017-18 and foreign exchange earnings from tourism in India stood at US$27.7 billion in 2018-19 compared to US$28.7 billion in 2017-18.
The IT-BPM (Business Process Management) industry grew by 8.4 per cent in 2017-18 to US$167 billion and is estimated to have reached US$181 billion in 2018-19.
Despite the recent growth moderation, services sector growth continues to outperform agriculture and manufacturing sector growth, contributing more than 60 per cent to total GVA growth, it says.
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Stressing the need for foreign direct investment (FDI) into the service sector, the Survey says: "FDI equity inflows into the services sector accounted for more than 60 per cent of the total FDI equity inflows into India."
"During 2018-19, FDI equity inflows into services sector fell by US$696 million or 1.3 per cent from the previous year to about US$28.26 billion, which is in line with the small decline witnessed in overall FDI inflows into India."
Highlighting the growth in the media and entertainment sector comprises, the report says technology has rapidly changed the profile of this sector especially in the area of content and carriage.
As per the FICCI-EY Media and Entertainment Report 2019, the size of the Industry has increased from Rs 91,810 crore in 2013 to Rs 1,67,500 crore in 2018, a growth of 82.44 per cent in the last 5 years.
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