Page 1 of 5
Journal for Studies in Management and Planning
Available at http://internationaljournalofresearch.org/index.php/JSMaP
e-ISSN: 2395-0463
Volume 01 Issue 07
August 2015
Available online: http://internationaljournalofresearch.org/ P a g e | 403
Trade in Services and Indian Business: An Overview
Naib Singh
Assistant Professor, Deptt. of Commerce, Rajiv Gandhi Govt. College, Saha-
(Haryana)
Abstract
Trade in services in India has gained
considerable importance. This industry is
contributing in the Gross Domestic product
up to 14.7 percent. Trading in this sector is
growing at the fast rate. Service sector of
the country is contributing to the Gross
Domestic Product up to 57 percent. This
sector includes banking, insurance,
education, health issues consultation,
transportation, hotel and catering services,
information technology, financial services,
logistics, business processing outsourcing,
communication, transmission, legal services,
real estate, research and development,
advertising, postal services, courier
services, tourism and online services. RBI
statistics issued in June 2015 on India’s
International Trade in Services reveals that
the total Exports receipts were valued worth
12765 US $ million and the total imports
payments were recorded worth Rs. 7522 US
$ million. Indian trade in services is helping
the sustainable growth of the economic
development by its growth-oriented nature.
Key words
Gross Domestic Product (GDP), Indira
Gandhi National Open University (IGNOU),
Comprehensive Bilateral Agreements
(CBAs), Free Trade Agreements (FTAs),
Services Export Promotion Council (SEPC),
Common Facility Centre.
Introduction
Trade of services occupies prominent place
in the economic perspective of any country.
Trade in service means buying and selling of
services. Service industry has very important
role to play in the development of the
industrial economy. Trade is also referred as
commerce and financial transaction.
Business entities deal into two types of
products namely, goods and services. Goods
are manufactured in the business
organizations and services are rendered or
provided by the same. Trade in services
includes dealing in intangible products
mainly. Service providing industry is also
called as territorial sector.
The services are provided by the service
providers in various types in the industry.
Service industry includes banking,
insurance, education, health issues
consultation, transportation, hotel and
catering services, information technology,
financial services, logistics, business
processing outsourcing, communication,
transmission, legal services, real estate,
research and development, advertising,
postal services, courier services, tourism
and online services. Sevices
Page 2 of 5
Journal for Studies in Management and Planning
Available at http://internationaljournalofresearch.org/index.php/JSMaP
e-ISSN: 2395-0463
Volume 01 Issue 07
August 2015
Available online: http://internationaljournalofresearch.org/ P a g e | 404
Trading can be categorized into two main
parts i.e. trade on the basis of domestic and
foreign trade and trade on the basis of
wholesale and retail trade. Domestic trade
involves the buying and selling within the
territory of the country while foreign trade
includes trading outside the borders of the
country. Wholesale trading includes selling
and distribution of the services to next
distribution channel and retailing trading
facilitates the availability of services to the
ultimate customer.
Objectives of the Study
In this paper the main area of discussion is
the magnitude of trade in the service sector
of India. An effort has been made to
highlight the contribution of this sector in
the economy. After analyzing the various
aspects of this area a discussion has been
designed to discuss the overall view of the
Indian trade in services.
Methodology
In the present study the information have
been collected through various published
and online sources. Data have been collected
for the purpose of analysis from secondary
sources. This study is not any case study
hence the outcome of the discussion are not
applicable to any particular area of the trade
in service sector.
Perspective of the trade in Service Sector
in India
Trading in services has important place in
economic development of developing
courtiers. India is attaining growth towards
development at the rapid rate. Trade in
services has great importance for the Indian
economy. Indian service sector is growing at
the fast rate. Service sector of the country is
contributing to the Gross Domestic Product
(GDP) up to 57 percent.
After the liberalization process since 1991
Indian service sector has been progressing in
the significant way. This sector is
facilitating a lot to the employment
generation, foreign trade and investment. In
the year 2010 the trade in services of the
country was at 13.6 percent of GDP which
has increased up to 14.7 percent in the year
2014. Figure 1 is depicting the year-wise
scenario of this sector in the following
section.
Figure 1: India’s Trade in Services (% of Gross Domestic Product)
Trade in sevices based on Territory
Domestic Trade
Foreign Trade
Trade in services based on Types
Wholesale Trade
Retail Trade
Page 3 of 5
Journal for Studies in Management and Planning
Available at http://internationaljournalofresearch.org/index.php/JSMaP
e-ISSN: 2395-0463
Volume 01 Issue 07
August 2015
Available online: http://internationaljournalofresearch.org/ P a g e | 405
Source: World Bank Statistics
This sector has attained significant progress
at international level. According to the
report of RBI issued in June 2015 on India’s
International Trade in Services, the total
Exports receipts were valued worth 12765
US $ million and the total imports payments
were recorded worth Rs. 7522 US $ million.
This data shows the favorable balance of
payment which is helping to generate the
foreign exchange in the nation.
India has achieved a prominent position in
the trading of higher education services in
the recent years. Indian education system
has now been considered very efficient for
creating skilled human power all over the
world. Distance courses are capturing great
popularity in this area. Indira Gandhi
National Open University (IGNOU) has
achieved prominent place in the gulf
countries like Abu Dhabi, Muscat, Kuwait,
Dubai and Doha. Private education sector is
achieving great popularity all over the
world. Indian education sector has proved
itself for providing the education at lowest
cost as compared to other nations.
Various service sectors of the country are
performing very well at the international
level. Figure 2 is showing the export and
exports data for the various prominent
service industries.
13.6 %
14.4 %
15 %
14.8 % 14.7 %
2010 2011 2012 2013 2014
