Mumbai: While industry was sluggish and grew at a poor 0.4 per cent the services sector grew at 6.8 per cent catapulting India to 12th position globally in 2012 among the world’s top 15 countries in terms of GDP.
Noting that industry grew at a mere 0.4 per cent in 2013-14 from one per cent in 2012-13, the Economic Survey 2013-14 said the key reasons for the poor performance have been contraction in mining activities and deceleration in manufacturing output.
The underlying for the poor performance of these two sectors was attributed to considerable deceleration in investment, particularly by the private sector during the previous two years. The survey expressed concern at the time overruns and cost escalation in infrastructure projects due to delays in regulatory approvals, problems in land acquisition and rehabilitation and environmental clearances.
The survey also expressed concern over the difficulties faced by firms in doing business and called for the need to simplify processes including those relating to tax policy and administration. India has the second fastest growing services sector with its CAGR at 9.0 per cent, just below China’s 10.9 per cent, during 2001 to 2012 said the survey.
