India’s Services Sector: NITI Aayog unveils groundbreaking reports on growth, employment, and state-level dynamics

THEBUSINESSBYTES BUREAU

NEW DELHI, OCTOBER 28, 2025

NITI Aayog has unveiled two pivotal reports that offer new insights into the evolution of India’s services sector, a cornerstone of the nation’s economic growth. Launched by B.V.R. Subrahmanyam, CEO of NITI Aayog, in the presence of Dr. Arvind Virmani and Dr. V. Anantha Nageswaran, these reports focus on the sector’s dynamics through both output and employment perspectives, marking one of the first macroeconomic assessments of services at such a granular, state-level scale.

The first report, titled *India’s Services Sector: Insights from GVA Trends and State-Level Dynamics*, delves into national and regional trends to gauge the extent of services-led growth across India. With services contributing nearly 55% to India’s Gross Value Added (GVA) in 2024-25, the findings suggest that, despite some widening disparities, there is growing regional equity in services growth. Notably, states traditionally lagging in services are now beginning to catch up with more advanced regions. The report advocates for prioritizing digital infrastructure, logistics, innovation, and skilling to further diversify the sector and enhance regional competitiveness.

The second report, *India’s Services Sector: Insights from Employment Trends and State-Level Dynamics*, shifts focus to the sector’s workforce. It paints a multifaceted picture of employment in services, highlighting its dual nature: high-productivity, globally competitive segments and informal, low-paying sectors that still dominate employment but remain underserved. The report stresses the importance of tackling uneven job creation, gender disparities, and the widespread informality in the sector. It outlines a comprehensive four-part policy roadmap that includes formalizing gig and MSME workers, boosting digital access, investing in green economy skills, and fostering regional development through service hubs in Tier-2 and Tier-3 cities.

Together, these reports underscore the vital role the services sector will play in India’s pursuit of becoming a developed nation by 2047. They call on both state governments and industries to integrate these strategies, deepen digital infrastructure, enhance skills, and foster innovation to unlock the next wave of services-driven growth.