The services sector in Tamil Nadu witnessed a real annual growth of 7.97% from 2020-21 to 2023-24, according to Tamil Nadu’s first Economic Survey.
During the same period, its sub-sectors — real estate grew at 9.41%, trade, repair, hotels and restaurants at 7.98%, transport and storage at 7.67%, public administration at 5.74%, and financial services at 4.69%. Tamil Nadu’s services (or tertiary) sector is diverse and includes several sub-sectors. such as trade, repair, hotels and restaurants, transport and storage. communication and broadcasting services, financial services, real estate and personal services, public administration, and other related services.
The Economic Survey said, anticipating high air traffic with the growth of the economy, the capacity of the State’s airports needs to be substantially upgraded. including the Chennai Greenfield Airport at Parandur. “Sectors with huge untapped potential for growth such as tourism require substantial investment. The multiplier effect of investing in tourism will be one of the highest among important sub-sectors.
Over the years, the sector has been suffering from underinvestment and this needs to be rectified,” it said.
“The government needs to massively invest in critical infrastructure services such as digital connectivity, power and transport. Considerable capacity addition will be required, especially in the power sector, in the next 10 years to meet the growing demand due to increased urbanisation, industrialisation and rise in income levels,” it added.
Tourism also presents a significant opportunity for growth, and the State must actively pursue the Tamil Nadu Tourism Policy 2023 to enhance infrastructure and visitor experiences. Encouraging longer stays with immersive tourism experiences can substantially increase revenue generation, the survey said.
According to the survey, IT and IT enabled services have played a crucial role in maintaining India’s balance of trade through export earnings. Tamil Nadu ranked fourth in software exports in the country, next only to Karnataka, Maharashtra and Telangana. The state’s software services exports have steadily increased from ₹ 46,704 crore in 2019-20 to ₹ 73,969 crore in 2022-23.
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