The Service Revolution in South Asia

The story of Hyderabad, the capital of the Indian state Andhra Pradesh, is truly inspiring for late-comers to development. Within two decades, Andhra Pradesh has been catapulted straight from a poor and largely agricultural economy into a major ser...

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Bibliographic Details
Main Author:	World Bank
Format:	Foreign Trade, FDI, and Capital Flows Study
Language:	English en_US
Published:	Washington, DC 2014
Subjects:	ACCOUNTING ADB ADVERSE CONSEQUENCES AGRICULTURAL GROWTH AGRICULTURAL OUTPUT AGRICULTURE ANNUAL GROWTH ASSETS AUDITS AVERAGE GROWTH AVERAGE GROWTH RATE BARRIERS TO ENTRY BASIC EDUCATION BEST PRACTICE BONDS CAPITAL FLOWS CAPITAL INFLOWS CAPITAL MARKETS CITIES COMPARATIVE ADVANTAGE COMPETITIVENESS COST DIFFERENTIALS COUNTRY REGRESSIONS COUNTRY SIZE CROSS COUNTRY CURRENCY APPRECIATION DEBT DEPENDENT VARIABLE DEREGULATION DESCRIPTION DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPMENT ASSISTANCE DEVELOPMENT ECONOMICS DEVELOPMENT INDICATORS DEVELOPMENT REPORT ECONOMIC ACTIVITY ECONOMIC COOPERATION ECONOMIC DEVELOPMENT ECONOMIC GEOGRAPHY ECONOMIC GROWTH ECONOMIC STRUCTURE EDUCATIONAL ATTAINMENT ELASTICITY EMPIRICAL LITERATURE ENGINEERS EXPORT GROWTH EXPORTS EXTERNALITIES FEMALE FINANCIAL CRISIS FINANCIAL SERVICES FOREIGN EXCHANGE FREE TRADE GDP GDP PER CAPITA GENDER GENDER EQUALITY GLOBAL ECONOMY GLOBAL MARKETS GOVERNMENT REGULATION GROWTH PATTERN GROWTH PERFORMANCE GROWTH RATE GROWTH RATES GROWTH REGRESSION HEADCOUNT POVERTY HEALTH CARE HIGH GROWTH HOTEL HOTELS INCOME INCOME ELASTICITY INDUSTRIAL DEVELOPMENT INDUSTRIAL SECTOR INDUSTRIALIZATION INELASTIC DEMAND INEQUALITY OUTCOMES INITIATIVE INSURANCE LABOR FORCE LABOR MARKET LABOR MARKETS LABOR MOBILITY LANDLOCKED COUNTRIES LAWS LOCALITIES LONG RUN MACROECONOMICS MIDDLE INCOME COUNTRIES MIGRATION MONEY LAUNDERING MULTINATIONAL 0 HYPOTHESIS OUTPUT GROWTH OUTPUT PER CAPITA POLICY DISCUSSION POLICY IMPLICATIONS POLICY ISSUES POLICY MAKERS POLICY MESSAGES POOR HOUSEHOLDS POVERTY RATE POVERTY RATES POVERTY REDUCTION PRICE DECLINES PRIMARY EDUCATION PRO-POOR PRODUCTIVITY PRODUCTIVITY GROWTH PROFITABILITY PROPERTY RIGHTS PUBLIC EXPENDITURE RAPID GROWTH REAL GDP REDUCING POVERTY RICH COUNTRIES RURAL POVERTY SAVINGS SHOPS SIGNIFICANT REDUCTION SKILLED WORKERS STRUCTURAL ADJUSTMENT TELECOMMUNICATIONS TERRORISM TOTAL FACTOR PRODUCTIVITY TOTAL FACTOR PRODUCTIVITY GROWTH TRAFFIC TRANSPORT UNEMPLOYMENT URBAN AREAS URBAN POVERTY URBAN WORKERS URBANIZATION VALUE ADDED WAGE RATES WAGES WATER SUPPLY WORLD TRADE ORGANIZATION WTO
Online Access:	http://documents.worldbank.org/curated/en/2009/06/11418589/service-revolution-south-asia http://hdl.handle.net/10986/19332

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Summary:	The story of Hyderabad, the capital of the Indian state Andhra Pradesh, is truly inspiring for late-comers to development. Within two decades, Andhra Pradesh has been catapulted straight from a poor and largely agricultural economy into a major service center. It has transformed itself from a lagging into a leading region. Fuelled by an increase in service exports of 45 times between 1998 and 2008, the number of information technology companies in Hyderabad increased eight times, and employment increased 20 times. Service-led growth has mushroomed in other parts of India and South Asia as well. Indeed, growth in the services sector has enabled South Asia to grow almost as fast as East Asia in this century, with growth of just under seven percent annually between 2000 and 2007. Growth rates in South Asia and East Asia have converged. The two fastest growing regions in the world, however, have very different growth patterns. While East Asia is a story of growth led by manufacturing, South Asia has thrived on service-led growth. The promise of the services revolution is that countries do not need to wait to get started with rapid development. There is a new boat that development late-comers can take. The globalization of service exports provides alternative opportunities for developing countries to find niches, beyond manufacturing, where they can specialize, scale up and achieve explosive growth, just like the industrializes. The core of the argument is that as the number of goods and services produced and traded across the world expand with globalization, the possibilities for all countries to develop based on their comparative advantage expand. That comparative advantage can just as easily be in services as in manufacturing or indeed agriculture.

The Service Revolution in South Asia

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