The Telegraph
Since 1st March, 1999
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Panel at the service of exports

New Delhi, Oct. 5: Prime Minister Manmohan Singh today said the government was exploring the possibility of setting up a high-level group of advisers in the Planning Commission to recommend policies for the service sector as part of its strategy to boost exports.

Inaugurating the Servin XPO 2006 exhibition, organised by the Federation of Indian Export Organizations (FIEO), the Prime Minister said the group, comprising representatives from the government, business and academia, would prepare a roadmap to develop the services sector.

He said the export potential in health, legal, higher education and tourism services was on a par with infotech. “In all these areas we have core competence that could be tapped successfully to boost exports,” he said.

Singh said these sectors had made little impact, with an absence of competition and weak regulations breeding inefficiency. The commerce ministry has already floated consultation papers to liberalise legal services and education.

The Prime Minister said huge investments were needed to set up universities, professional colleges and nursing schools to meet the growing demand of services in the domestic and international markets.

He said an appropriate policy framework for education services was necessary to encourage public sector and private investment.

The Prime Minister also urged reforms of the legal sector to exploit the opportunities in international law, commercial and third-country law that were available with the globalisation of the economy.

He said health services also had immense potential, particularly medical outsourcing and medical tourism.

Singh suggested the development of service standards and an accredition mechanism for the health sector.

He estimated a gap of 42 million between demand of workers and supply by 2020 in the US, China, Japan and Russia. He said India would have a surplus of 47 million workers in 2020 who, with suitable education, could find employment outside the country.

“However, to translate the demographic dividend into a development dividend we have to expand our education system and improve our skill building abilities. This is an urgent priority that we need to attend to,” Singh said.

He said the global offshoring market would touch $110 billion by 2010 and India was capable of cornering a 50 per cent market share.

“The direct and indirect employment impact generated could be over one crore jobs within five years and it could contribute an additional one per cent a year to our GDP,” he said.

Earlier speaking at the meeting organised by Unctad and Fieo, commerce and industry minister Kamal Nath said the service sector was registering a robust growth across the world. He said service sector exports from India grew to $60 billion in 2005-06 and accounted for 37 per cent of the total exports.

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