Which Sector in India has benefitted the most from Globalization ?
Services
The services sector has gained most — option 1.
The evidence. After the liberalisation of 1991, services grew faster than the rest of the economy on every measure :
| Measure | What happened |
|---|---|
| Share of GDP | Rose from about 40 per cent to over half; services are now the largest sector by a wide margin |
| Exports | Software and business services grew from almost nothing to well over 150 billion dollars a year; India became the world’s largest exporter of information-technology services |
| Foreign investment | Services, computer software and telecom attract the largest shares of FDI |
| Global capability centres | Hundreds of multinationals run research and back-office centres in Bengaluru, Hyderabad, Pune and Gurugram |
Why services and not manufacturing. Three things favoured them. Services could be delivered across borders by telecommunications without the ports, roads and power that a factory needs, so India’s weak physical infrastructure mattered less. They rested on a large supply of English-speaking graduates from the engineering and management institutions. And they were not held back by the labour and land regulations that constrained large-scale manufacturing.
Why the other options are wrong. Manufacturing has stayed close to 16-17 per cent of GDP for three decades, and the Make in India target of 25 per cent has not been reached — India’s is often called a services-led growth story precisely because it skipped the usual manufacturing stage. Agriculture gained least: its share of output kept falling while it continued to employ nearly half the workforce, and exposure to world prices brought volatility as much as opportunity. And option 2 is contradicted by all of this — the gains have been strikingly uneven.
The qualification. Services-led growth creates far fewer jobs per unit of output than manufacturing, and the jobs it creates need skills the majority of the workforce does not have. That is the central criticism of the pattern, and the reason manufacturing remains a policy priority.
Hence, the answer is Services.
Important Questions from External Sector and Currency Exchange rate
Consider the following :
1. Foreign currency convertible bonds
2. Foreign institutional investment with certain conditions
3. Global depository receipts
4. Non-resident external deposits
Which of the above can be included in Foreign Direct Investments?
Procedure for online trading involve(s) which of the following step(s)?
I. Make an application to open a Demat Account and Online Trading Account.
II. Allocate funds from the bank account to the trading account.
III. Once the order is confirmed, it is placed in the stock exchange through the online trading system.
The balance of payments of a country is a systematic record of
What is the idea that a country should be self-sufficient and not participate in international trade called?
(A) : Devaluation results in expenditure switching in an economy.
(R) : Devaluation alters the composition of the current account of the balance of payments.
