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Services-led industrialization in India: Assessment and lessons

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  • Singh, Nirvikar

Abstract

This paper provides an integrated analysis of the role of the service sector in recent Indian economic development. It discusses the nature of services, their distinction from products, and their categorization. It provides an overview of India’s overall growth experience, and a detailed examination of the contribution of the service sector to growth. It includes an examination of the potential for spillovers from IT, ITES and other service sectors such as financial services, to the rest of the economy, drawing on econometric work, as well as input-output analysis of linkages to understand these possible spillovers and growth potentials. Based on this evidence, it appears that India’s manufacturing sector development may have been constrained in part by weaknesses in key service sectors such as transportation and electricity. The paper also considers the particular role of international trade in services, which is of growing importance. It discusses the consequences for employment of different growth paths, the challenges of education and manpower training to support and sustain India’s development path, and social and environmental issues, including regional inequality issues. The Indian experience is related to recent discussions of industrial policy, and development policy more generally.

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  • Singh, Nirvikar, 2006. "Services-led industrialization in India: Assessment and lessons," MPRA Paper 1276, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:1276
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    Cited by:

    1. Sohini Sahu, 2015. "Source of Service Sector TFP Growth in India: Evidence from Micro-data," South Asian Journal of Macroeconomics and Public Finance, , vol. 4(1), pages 62-90, June.
    2. Singh, Nirvikar, 2008. "India’s Development Strategy: Accidents, Design and Replicability," MPRA Paper 12453, University Library of Munich, Germany.
    3. Singh, Nirvikar, 2006. "ICTs and rural development in India," MPRA Paper 1274, University Library of Munich, Germany.
    4. Nirvikar Singh, 2007. "The dynamics of reform of India’s federal system," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 8(01), pages 22-31, April.
    5. Cortuk, O & Singh, N, 2015. "Analysing the structural change and growth relationship in India," Santa Cruz Department of Economics, Working Paper Series qt4qx907p3, Department of Economics, UC Santa Cruz.
    6. Cortuk, Orcan & Singh, Nirvikar, 2011. "Structural change and growth in India," Economics Letters, Elsevier, vol. 110(3), pages 178-181, March.
    7. Singh, Nirvikar & Srinivasan, T.N., 2006. "Federalism and economic development in India:An assessment," MPRA Paper 1273, University Library of Munich, Germany.
    8. K L Krishna & Deb Kusum Das & Abdul Azeez Erumban & Suresh Aggarwal & Pilu Chandra Das, 2016. "Productivity Dynamics in India's Service Sector: An Industry-Level Perspective," Working Papers id:11401, eSocialSciences.
    9. Verma, Rubina, 2012. "Can total factor productivity explain value added growth in services?," Journal of Development Economics, Elsevier, vol. 99(1), pages 163-177.
    10. Eva Näfe & Barbara von Toll, 2011. "Is Broad Industrialisation Imperative for Development? Case Studies on Uganda and Tanzania," Competence Centre on Money, Trade, Finance and Development 1105, Hochschule fuer Technik und Wirtschaft, Berlin.
    11. Ashkok Kotwal & Bharat Ramaswami & Wilima Wadhwa, 2011. "Economic liberalization and Indian economic growth: What's the evidence?," Discussion Papers 11-13, Indian Statistical Institute, Delhi.
    12. Thomas, P Mini, 2015. "Tax contribution of service sector: An empirical study of service taxation in India," Working Papers 344, Institute for Social and Economic Change, Bangalore.
    13. Nirvikar Singh, 2007. "The dynamics of reform of India’s federal system," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 8(1), pages 22-31, April.

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    More about this item

    Keywords

    Services; industrialization; India; economic development; industrial policy;
    All these keywords.

    JEL classification:

    • L88 - Industrial Organization - - Industry Studies: Services - - - Government Policy
    • L8 - Industrial Organization - - Industry Studies: Services
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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