It's Skilling That Will Speed Up and Integrate Manufacturing and Services

The modern economy is about services woven into every aspect of life

- Antony Cyriac, Mamta, Radhika Goyal & Ajay Ojha

The services sector continues to be the backbone of India's economic growth. Its share in gross value added is estimated to increase from 50.6% in 2013-14 to 55.3% in 2024-25. The country has outpaced many lower- and middle-income countries in expanding its services footprint. India has become the seventh-largest exporter of services and the fourth-largest in digitally delivered services. Globally, services are driving growth even in countries where manufacturing is slowing down due to weaker merchandise trade. This creates opportunities for services exports and domestic services output. However, global supply chains face disruptions caused by geopolitical uncertainties, posing downside risks.

The services sector continues to be India's resilient growth engine, driving expansion through domestic absorption and global trade. This dynamism of services touches our daily lives in increasingly sophisticated ways. If you have ever tracked your delivery package in real time or accessed a customer service chatbot at 3 a.m., you have experienced the rise of 'servicification'. The servicification of any activity, for instance, manufacturing, means that the sector increasingly relies on services as inputs, activities within firms, or bundled output. The modern economy is not just about goods and products anymore; it is about services seamlessly woven into every aspect of life. This phenomenon blurs the lines between manufacturing and services and boosts economic growth.