NITI Aayog released two inaugural reports under its “Services Thematic Series”, offering one of the first dedicated, data-driven assessments of India’s services sector. The reports provide macro and state-level analysis on output and employment, highlighting the services sector’s role in India’s economic transformation and inclusive growth.
Two Reports Released:
| Report Title | Focus Area | Objective |
| 1. “India’s Services Sector: Insights from GVA Trends and State-Level Dynamics” | National & state-level growth and GVA trends | Examine how services-led growth varies across states and whether lagging states are catching up |
| 2. “India’s Services Sector: Insights from Employment Trends and State-Level Dynamics” | Employment, informality, and inclusion trends | Analyse the nature and quality of jobs in India’s services sector and suggest ways to make growth more inclusive |
First Report: “Insights from GVA Trends and State-Level Dynamics”)
- The services sector contributes ~55% of India’s Gross Value Added (GVA) in FY 2024–25, making it the cornerstone of economic growth.
- Evidence of regional convergence: structurally lagging states are gradually catching up with advanced states, reflecting more balanced regional growth.
- Inter-state disparities in service shares have only modestly widened, showing a move toward spatial inclusiveness.
- Growth drivers: Digital infrastructure, logistics, innovation, finance, and skilling are key to competitiveness.
Recommendations for states:
- Develop tailored service strategies based on local strengths.
- Build institutional capacity and urban service clusters.
- Integrate services with industrial ecosystems to create composite growth models.
Second Report: “Insights from Employment Trends and State-Level Dynamics”
- The services sector employed 188 million workers in 2023–24, making it India’s 2nd largest employer after agriculture.
- In 2024–25, the sector contributed 55% to GVA, but provided less than one-third of total jobs, showing low employment intensity.
- Added ~40 million jobs in the last six years — second only to construction.
Dual nature of employment:
- Modern services (IT, finance, healthcare) — high productivity but limited jobs.
- Traditional services (trade, transport, repair, personal services) — absorb more labour but are largely informal.
Employment Characteristics
| Parameter | Observation |
| Urban vs Rural | 60% of urban workers employed in services; <20% in rural areas. |
| Gender | Only 10.5% of rural women vs 60% of urban women work in services; high wage disparity persists. |
| Informality | ~87% of workers lack social security coverage. |
| Education | Higher education improves access but does not guarantee formality. |
| Job Quality | Widespread informality and low wages; gender and regional gaps persist. |
Roadmap for Transformation (Policy Recommendations)
Formalisation & Social Protection
- Extend coverage to gig, self-employed, and MSME workers.
- Strengthen EPFO, ESI, and portable benefits systems.
Inclusive Skilling & Digital Access
- Target women and rural youth through digital tools, remote work, and flexible skilling.
Tech-Led & Green Skilling
- Develop capabilities for AI, digital services, green jobs, and global value chains (GVCs).
Regional Diversification
- Build Tier-2 and Tier-3 city service hubs.
- Support state-specific clusters (e.g., tourism, healthcare, education, logistics).
Significance
- Reinforces the services sector’s centrality in India’s “Viksit Bharat @ 2047” vision.
- Highlights employment quality, inclusion, and regional equity as the next frontiers of growth.
- Establishes a policy roadmap for aligning services-led output growth with employment generation.
Key Facts
| NITI Aayog | Established: 1 January 2015, replacing Planning Commission Headquarters: New Delhi Chairperson: Prime Minister of India Vice-Chairperson (2025): Suman Bery; holding rank and status of a Cabinet Minister CEO (2025): B.V.R. Subrahmanyam |
| Services Sector in India (2024–25) | Contributes ~55% of GVA, 40% of exports, and employs ~188 million people. Major sub-sectors: IT & ITES, Finance, Real Estate, Tourism, Healthcare, Education, Trade & Logistics. |
| GVA (Gross Value Added) | Measures the value of goods and services produced in an economy minus input costs. It is a key indicator of sectoral contribution to GDP. |
| Gig Economy in India | Estimated workforce: 7.5 million (2025); projected to reach 24 million by 2030 (NITI Aayog report 2022). |
| Viksit Bharat @ 2047 | Vision document outlining India’s roadmap to become a developed nation by 2047, focusing on inclusive, sustainable, and innovation-led growth. |