Page 477 - ES 2020-21_Volume-1-2 [28-01-21]

104 Economic Survey 2020-21 Volume 2

The above evidence holds lessons for India to build specialization in products in which it
is competitive. This pattern was also examined in Chapter 5, Economic Survey, 2019-20
wherein it was shown that high diversification combined with low specialization implied that
India is spreading its exports thinly over many products and partners.

Invisibles

3.17 Net services receipts amounting to US$ 41.7 billion remained stable in April-September, 2020
as compared with US$ 40.5 billion in corresponding period a year ago, notwithstanding a sharp
contraction in travel receipts owing to the international mobility restrictions imposed at the onset of
the pandemic and falling remittances (Figure 12a). Resilience of the services sector was primarily
driven by software services, which accounted for 49 per cent of total services exports (Figure 12b).

Figure 12a: Net Services Trade

Net Services Services Export (RHS) Services Import (RHS)
23 15

22 10
5
21
US$ Billion 20 21.7 21.9 22.0 0 -5 Growtth rate (Y-o-Y), Per cent

19
20.3 21.3 20.0 20.4 20.5 21.2 -10
18 18.7 -15

17 -20
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2018-19 2019-20 2020-21

Figure 12b: Composition of Net Services Exports

Travel Transport Software Business
30 Financial Communication Others

25
20
15
US$ Billion 10 5

0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
-5
2018-19 2019-20 2020-21
-10
Source: Reserve Bank of India (RBI)

3.18 Net private transfer receipts, mainly representing remittances by Indians employed overseas,
totaling US$ 35.8 billion in H1: FY 2020-21 declined by 6.7 per cent over the corresponding
period of previous year. It is pertinent to note that as per the World Migration Report 2020,