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SERVICE SECTOR IN INDIA

• The service industry forms a backbone of social and economic development of a region. • It has emerged as the largest and fastest-growing sectors in the world economy. • Its growth rate has been higher than that of agriculture and manufacturing sectors. • India ranks fifteenth in the services output and it provides employment to around 23% of the total workforce in the country.

• The Sector of Services in India has the biggest share in the country's GDP . Communication and storage. Insurance & financing. Social and personal services.• The Services Sector contributes the most to the Indian GDP for it accounts for around 60-65% in 2010. Business services. • The various sectors under the Services Sector in India are : • • • • • • Hotels. Transport.

5%  Services contribution – 60%  Balance of Trade – Negative balance should increase with surging imports versus exports  Investment goal – USD 305 billion 2006  GDP – USD 590 billion  GDP growth rate – 9%  Services contribution – 54%  Balance of Trade – USD (-)46.16 trillion  GDP growth rate – 9.2 billion  Investment goal – USD 250 billion .36 trillion  GDP growth rate – 9%  Services contribution – 60-65%  Balance of Trade – Negative balance should increase with surging imports versus exports  Investment goal – USD 370 billion 2008 *  GDP – USD 1.CONTRIBUTION OF SERVICE SECTOR IN INDIAN ECONOMY 2010 *  GDP – USD 1.

Growing GDP 1.200 1.000 800 600 400 191 200 0 103 105 453 Contribution of Services increased from 48% to 62% and is estimated to contribute 60% by 2010 USD Billion 682 398 237 125 105 204 135 2005-06 Industry 231 145 2006-07 Services 287 167 2010* 1999-00 2002-03 Agriculture .

• Hotels are classified into six categories according to the star rating assigned by the Department of Tourism. • There are around 1000 classified hotels and the total room availability is pegged at 97.000 rooms. .The Hotel Industry • Hotels form one of the most important support service that affect the arrival of tourist to a country. • The major players in the industry are Indian Hotels Company Ltd (IHCL). • About 30% of the rooms fall under the 5-star deluxe categories.

• Manpower costs in the Indian hotel industry is one of the lowest in the world.T ANALYSIS OF HOTEL INDUSTRY • Strengths • A very wide variety of hotels is present in the country that can fulfill the demand of the tourists.O.S. . This provides better margins for Indian hotel industry. • There are international players in the market such as Taj and Oberoi & International Chains.W.

• Weaknesses • The cost of land in India is high at 50% of total project cost as against 15% abroad. . • The services in Indian hotel is not world standards. • Opportunities • Unique experience in heritage hotels. • Demand between the national and the inbound tourists can be easily managed due to difference in the period of holidays. • High tax structure in the industry makes the industry worse off than its international equivalent.

• Lack of training man power in the hotel industry.• Threats • Guest houses replace the hotels. • Political turbulence in the area reduces tourist traffic and thus the business of the hotels. .

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