Balancing Service competitiveness and Skill Gap in Globalised India

Services play a dominant role in India and the policies formulated in various sectors guide India’s economic development, which stresses primarily on inclusiveness. Initiatives by government and private institutions have significant consequences in evolving the discourse of service industry. Emerging sectors like ITES, Retail, Telecommunication, Banking, Tourism, Education, E Commerce – Online Shopping/Services etc are fuelling the growth process. Through this paper we aim to analyze the skill development policies and its implications in service industry both at the macro and micro level for India. Recent studies emphasize the idea of “service led growth” in India for capitalizing on the labour productivity gap. The evidence from the study shows that there is a consistent stagnation of the agricultural sector and moderate industrial growth which leads to conclude that competition with other economies like China is a challenge. Hence an inevitable course of action projected is “labour productivity lead” in service sector. In order to succeed in Service sector we need to focus on the current skill quotient of the nation. Since skill gap is high it is essential to invest in skill education and impart relevant resources for different segments and services in service industry. Further, service sector has an independent capacity coupled with the symbiotic relationship with the manufacturing sector in providing opportunities in terms of entrepreneurship and employment generation.