Service Sector

India’s services sector activity, gauged by PMI Services, which remained in the contractionary zone for several months during 2020 and 2021 on account of the restrictions imposed to tackle the Covid-19 pandemic, recovered swiftly with the waning of the Omicron variant at the beginning of 2022.

• The World Investment Report 2022 of UNCTAD places India as the seventh largest recipient of FDI in the top 20 host countries in 2021.
• In FY22 India received the highest-ever FDI inflows of US$ 84.8 billion including US$ 7.1 billion FDI equity inflows in the services sector.

Tourism

• As per the World Tourism Barometer of the United Nations World Tourism Organisation (November 2022), international tourism showed robust performance in January-September 2022, with international tourist arrivals reaching 63 per cent of the pre-pandemic level in the first nine months of 2022, boosted by strong pent-up demand, improved confidence levels and the lifting of restrictions.
• A significant decline in Foreign Tourist Arrivals in India was witnessed in FY21.
• As per a study conducted by the Ministry of Tourism in collaboration with the National Council of Applied and Economic Research (NCAER), Tourism Direct Gross Value Added (TDGVA) witnessed a decline of 42.8 per cent in Q1, 15.5 per cent in Q2, and 1.1 per cent in Q3 of FY21 due to the overall economic slowdown in FY21.
• India is ranked 10^th out of the top 46 countries in the World in the Medical Tourism Index FY21 released by Medical Tourism Association.

E-commerce

• According to the Global Payments Report by Worldpay FIS, India’s e-commerce market is projected to post impressive gains and grow at 18 per cent annually through 2025.

Digital Financial Service

• While globally, the technological solutions cushioned the reverberations of the pandemic, India took the lead with the fintech adoption rate of 87 per cent, substantially higher than the world average of 64 per cent as per the latest Global FinTech Adoption Index.