Previous Year Question
The largest share of Gross Domestic Product (GDP) in India comes from
agriculture and allied sector
manufacturing, construction, electricity and gas
service sector
defence and Public administration
Correct Answer: C
Detailed Solution
The Service Sector contributes the largest share to India's Gross Domestic Product (GDP). It is also known as the Tertiary Sector of the economy. It includes trade, transportation, communication, banking, insurance, tourism, education, healthcare, information technology, and other services.
According to the Economic Survey 2011–12, the shares of different sectors in India's GDP at constant prices (2004–05 base year) were as follows—
Economic sector | Share in GDP |
Agriculture and allied sectors | 13.9% |
Industrial sector | 27.0% |
Service sector | 59.0% |
After Independence, the contribution of agriculture to India's GDP gradually declined, while the shares of the industrial and service sectors increased. According to the Economic Survey 2011–12, the service sector contributed 30.3% in 1950–51, which increased to 50.4% in 2000–01 and 59.0% in 2011–12.
The Agriculture and Allied Sector (Primary Sector) includes agriculture, animal husbandry, forestry, and fisheries. The Industrial Sector (Secondary Sector) includes manufacturing, mining, construction, and activities such as electricity, gas, and water supply. Compared with these two sectors, the service sector contributed a larger share to GDP.
Defence and Public Administration are components of the service sector itself. They fall under government and public services rather than constituting a separate major economic sector outside the service sector.
The increasing share of the service sector in India's economic structure reflects Structural Transformation. However, a higher share of a sector in GDP does not necessarily mean that the largest proportion of the population is employed in that sector.