SERVICES SECTOR: AN ENGINE OF INCLUSIVE GROWTH IN INDIA.

India is one of the fastest growing economies in the world after China. Indian economy was least affected by the global slow down due to strong fundamentals, highly resilient domestic economy, high saving and investment rates and a dynamic and strong service sector. Like other economies in the world, the service sector is the engine of growth of the Indian economy. The services sector in India is one of the major contributor to both national income and employment. When the New Economic Policy was introduced in 1991, Indian economy underwent a structural transformation from the ‘Agriculture-led growth’ to ‘Services-led growth’. India’s high growth rate in the post-reform period was mostly achieved and maintained by the spectacular and consistently robust growth of the services sector. Services sector in India is the most dynamic sector, growing at an average annual rate of about 10 per cent, and exhibiting enough resilience to nullify the negative repercussions of the global financial crisis. India is marching towards a service-led export growth rather than manufacturing-led export growth. There are various problems and challenges that are faced by the service sector.