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Trade in Services - strategic considerations:
India has emerged as a major exporter of services, bringing about a change in our negotiating position at the WTO. India's trade in services, especially software exports have made a real dent in the world market. It ranked 18" largest services exporter with a share of 1.4 percent in global exports in 2003. An upward shift in trend growth of services exports from an average annual of 7.9 percent in the first half of 1990s to 15.3 percent in 2000-0112003-04 reflect the growing volume of these exports in India's total exports. Traditionally while services receipts have been mainly from travel, transportation and insurance sub-sectors, more recently the buoyant growth of professional, technical and business services has provided a cushion against the slowdown in the former categories. These new economy services witnessed an average annual growth of about 37 percent during 1995-961 2003-04, contributing over 70 percent of total services exports in 2003-04. Software services export share alone rose from 10.2 percent in 1995-96 to 48.9 percent in 2003-04. Exports of software and IT-enabled services rose by about 28 percent in 2003-04 and further 34.4 percent to reach mce_markernbsp; 17.2 billion in 2004-05. The global market for software and services is projected to grow by 8.6 percent per mum during 2004-08. India remains an attractive source of software exports because of low cost of operations and availability of high quality and skilled manpower resources. Another factor is that the structure of software services exports shows that financial services including banks, insurance companies and securities firms account for the largest share of Indian software services followed by manufacturing and telecom sectors.
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