Indian Economy Presentation

8/7/2019 Indian Economy Presentation

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HARSHITA MATHUR

B.COM (H) THIRD YR

ROLL NO- 445

TUT GROUP- H 48

Growth of service sector in India


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THE VARIOUS SECTORS THAT COMBINETOGETHER TO CONSTITUTE SERVICE

INDUSTRY ARE: Trade

Hotels and Restaurants

Railways

Other Transport & Storage

Communication (Post, Telecom)

Banking

Insurance

Dwellings, Real Estate

Business Services Public Administration; Defense

Personal Services

Community Services

Other Services

by santosh R.N.S.I.T coll


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OVER VIEW OF SERVICE SECTOR

Service Sector in India today accounts for more

than half of India's GDP.

According to data for the financial year 2006-2007, the share of services, industry, and

agriculture in India's GDP is 55.1 per cent, 26.4

per cent, and 18.5 per cent respectively


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GROWTH OF SERVICE SECTOR UNDERFIVE-YEAR PLAN

First-five year plan(1951-56)

The total plan of budget was 206.8 billion Among the total plan transportation and communication

had got allocated to 24% i.e., 49.7 billion and social

services accounted for 16.64% 33 billion

At the end of the plan period in 1956, five Indian InstitutesofTechnology (IITs) were started as major technical

institutions.


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SECOND-FIVE YEAR PLAN(1956-61) The second five-year plan focused on industry, especially

heavy industry. Domestic production of industrial productswas encouraged, particularly in the development of the

public sector.

Transport and communication was given 23.6% of total

budget(430 billion)

OBJECTIVES

a sizeable increase in national income so as to raise the

level of living in the country; rapid industrialization with particular emphasis on the

development of basic and heavy industries;

a large expansion of employment opportunities; and

reduction of inequalities in income and wealth and a moreeven distribution of economic ower.


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THIRD-FIVE YEAR PLAN(1961-1966)

The third plan stressed on agriculture

Again there was more emphasize was given only on

transportation in service sector which accounted to 21%.

FOURTH-FIVE YEAR PLAN(1969-1974)

A total outlay of Rs. 24,882 crores is envisaged for the

Fourth Plan. of the aggregate outlay, Rs. 15,902 crores is in

respect of the public sector Plan and Rs, 8,980 crores for

the private sector.

In service sector 14 major banks were nationalized


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FIFTH-FIVE YEAR PLAN(1974-79)

Stress was laid on employment, poverty

alleviation, andjustice. The plan also focused

on self-reliance in agricultural production and

defense


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SIXTH-FIVE YEAR PLAN(1980-85)

Called the Janata government plan, the sixth plan marked a

reversal of the Nehruvian model.

When Rajiv Gandhi was elected as the prime minister, the

young prime minister aimed for rapid industrial development,especially in the area of information technology. Progress

was slow, however, partly because of caution on the part of

labor and communist leaders.


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SIXTH-FIVE YEAR PLAN(1980-85)

Tourism also expanded.

The sixth plan also marked the beginning of economic

liberalization

Transport 12411.97 crores Communications and information and broadcasting

3124.67

Social services 14035.26


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OUTCOMES OF SIXTH-YEAR PLAN

The production of Computer Numerically Controlled

(CNC) machine tools.

The commissioning of the first electronic telecom

exchange and the running of trains with trailing loadsof 3000 tonnes.


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SEVENTH-FIVE YEAR PLAN(1985-89)

The plan lay stress on improving the productivity level of

industries by up gradation of technology.

Communication, Information and broadcasting 647.2

billion Posts 29.5 billion

Telecommunications 453.8 billion

Education, culture and sports 638.3 billion

Health including medical 339.3 billion


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PERIOD BETWEEN 1989-91

1989-91 was a period of political instability in India and

hence no five year plan was implemented. Between 1990

and 1992, there were only Annual Plans

In 1991, India faced a crisis in Foreign Exchange (Forex)

reserves, thus the country took the risk of reforming the

socialist economy.

At that time Dr. Manmohan Singh launched India's free

market reforms that brought the nearly bankrupt nation

back from the edge. It was the beginning of privatizationand liberalization in India.


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EIGHTH-FIVE YEAR PLAN(1992-97)

This plan can be termed as Rao and Manmohan

model of Economic development

Transport 879.10 billion

Communication 2600 billion

Financial services 10.21%

Trade 9.06%

Communication 14.31% Other services 6.22%


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NINTH-FIVE YEAR PLAN(1997-2002)

Total outlay was 85920 billion

Transport 12132 billion 14.1 %

Communication 4761 billion 5.5 %

Financial services 8.93%

Trade 5.86%

Communication 17.14%

Other services 8.19%


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CONTRIBUTION OF TRAVEL AND TOURISM

TO GDP AND EMPLOYMENT

World

Average(%)

Indian

(%)

World

rank

Contribution ofTourism and Travel Economy

to GDP

10.7 5.3 140

Contribution ofTourism and Travel Industry

to GDP

4.2 2.5 124

Contribution ofTravel and Tourism EconomyEmployment

8 5.6 140

Contribution ofTravel and Tourism Industry

Employment

3.1 2.9 111


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TENTH-FIVE YEAR PLAN(2002-07)

The projected resource allocation of tenth year plan

was 15,92,300 crores

Transportation allocated 225977 crores

Information Technology 5492 crores

Post 1350 crores

Tlcommunications 86984 crores

Tourism 2900 crores


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TOURISM RECEIPTS

(IN BILLION US$)

Year World earnings Earnings by India Share of India in

world earnings

2002 487 2.9 .60

2003 533 3.5 .66

2004 633 4.8 .75

2005 678 5.7 .80

2006 735 6.6 .89


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GROWTH RATE (REAL) OF FINANCIAL SERVICES

(BANKING AND INSURANCE)

S

No.

Year Rate of growth Percentage

share in GDP

1

23

4

5

67

8

2000-01

2001-022002-03

2003-04

2004-05

2005-062006-07

2000-01 to 2006-07

(average)

-2.0

9.111.3

2.2

8.8

14.013.0

8.1

5.5

5.76.1

5.8

5.9

6.16.3

5.9


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ELEVENTH-FIVE YEAR PLAN(2007-2012)

Transportation allocated 202045

Information Technology 11048

Post 3536 Tlcommunications 80753

Tourism 4558


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MILE STONE IN THE GROWTH OF SERVICESECTOR

The emergence of India as one of the fastest growing

economies in the world during the 1990s is

attributable to the rapid growth of its services sector

to a great extent. The sector has been experiencing double-digit since

2004-05 importantly, a strong growth of 10 % in

2005-06 has been instrumental in providing an

impetus to overall real sector activity in the economyand propelling it to record a sturdy growth of 8.4 per

cent.


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Keynote reforms, initiated by the then Finance

Minister Dr Manmohan Singh in 1991, provided

the momentum for a major reduction of the role of

the public sector in the economy, a degree of

deregulation, and greater integration of Indiaseconomy into international markets. Indias

entrepreneurial spirit was unleashed.


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Subsequent to this, the sector has continued to exhibit

vibrant growth (10.6 per cent) during the first quarter of

2006-07 over the corresponding period of the previous year,mainly propelled by growth in trade, hotels, transport and

communication (13.2 per cent) followed by finance,

insurance, real estate and business services (8.9 per cent)

Due to the structural transformation of the Indian economyin the new millennium in favor of a service-dominated

economy, the share of the services sector in the total GDP

has increased notably from 49.8% in 2000-01 to 54% in

2005-06.

During the first quarter (April-June) 2006-07, the services

sector has accounted for a share of 54.2% as compared to

53.3% in the comparable period during last year


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QUARTERLY ESTIMATES OF PRODUCTION FOR

MAJOR COMPONENTS OF SERVICES SECTOR

(RS CRORE)Sub-sectors 2006-07 2005-06 2004-05 2006-07 2005-06% change over

1. Trade, hotels, 175025 154642 138390 13.2 11.7

Transport

and communication (26.7) (25.7) (24.9)

2. Financing, insurance,real estate

and business services 91527 84021 77245 8.9 8.8

(14.0) (13.9) (13.9)

3. Community, social

and personal services 88,771 82637 77009 7.4 7.3

(13.5) (13.7) (13.9)

All Services (1+2+3) 355323 321300 292644 10.6 9.8

(54.2) (53.3) (52.7)

GDP at factor cost 656,064 602476 555,075 8.9 8.5


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INDIA'S NET RECEIPTS FROM TRAVEL

ON BALANCE OF PAYMENTS

Year Receipts Payments Net Receipts ForeignTouristArrivals

(in million US$) (million no)

2000-01 3497 2804 693 2.7

2001-02 3137 3014 123 2.4

2002-03 3312 3341 -29 2.5

2003-04 5037 3602 1435 2.9

2004-05 6495 5510 985 3.5

2005-06 7789 6421 1368 4.1


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CURRENT GDP OF SECTORSUnit of

DescriptionPeriod of

latest dataLatestData

Previousdata @

Percentagechange from

previous to

latest period

Agriculture, Forestry & FishingRs.Crore

Oct/08-

Dec/08273723 253873 7.8

Mining & Quarrying Rs.Crore 32955 26731 23.3Manufacturing Rs. Crore 192994 178390 8.2

Electricity, Gas &

Water Supply.Rs. Crore 19867 18962 4.8

ConstructionRs.Crore 110773 95227 16.3

Trade, Hotels, Transport and

CommunicationRs.Crore 318345 282357 12.7

Financing, Insurance, Real

Estate & Business Services.Rs.Crore 177464 149629 18.6

Community, Social & Personal

Services. Rs.Crore 178345 138694 28.6


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CONCLUSION

New Delhi, Feb 15 (IANS) India's service sector couldsee slower growth, said a Confederation of IndiaIndustry (CII) report released here Sunday.

According to CII, recent data on specific service sectoractivities gives a mixed picture - while there has beena sharp drop in indicators such as tourist arrivals or airfreight and passenger movements, railway traffic andcellular subscriber growth have been holding up.

In banking, deposit and credit growth have begun toslow down - though only moderately.

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