Net Service Exports Rise 35% In June Quarter

There is something to cheer in a rather sluggish economy. The net exports of services (the difference between exports and imports), has jumped up by 35.5 per cent to USD 17.4 billion on a year-on-year basis. This is certainly a better performance as compared to a decline of 1.99 per cent registered during the fourth quarter 2012-13.

On a yearly basis, service exports have improved by 14 per cent to USD 37.9 billion whereas the imports of services have remained flat. On a sequential quarter basis, exports of services have declined by 1.17 per cent while service imports were down 1.55 per cent.

Indian service export consists of various services such as Information Technology, Healthcare, communication, etc. IT services play a very vital role as they form 46% of the total services exports from India. A rise in exports bodes well for the IT sector as it will reap the benefits of rupee depreciation. 

The service sector has proved its importance by contributing handsomely in GDP. Moreover, Services have boomed on their own, without any major support from the Government. It is expected that net service exports would rise in the near future since their growth rate is higher than the Merchandise exports. Also, imports of services have shown a flattish trend and hence there is also a higher likelihood of a rise in the net services exports.