Explain giving reasons which sector contributes highest GDP % in present scenario and why?
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Answer:
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As per the Economic Survey 2019–20, Tertiary sector contributes most to the GVA of India.
Primary sector (agriculture and allied activities):- its contribution to GVA in 2019–20 was 16.5%.
Secondary sector (industry and infrastructure):- its contribution to GVA in 2018–19 was 29.6%.
Tertiary sector (services):- its contribution to GVA in 2019–20 was 55.3%.
As any economy grows, the contribution of primary sector reduces and, in turn, this reduction is compensated by the increase in the contributions from secondary and tertiary sector. Most of the developed world economies gets their largest share of GVA from the service sector only.
PS:- Gross value added (GVA) is defined as the value of output less the value of intermediate consumption.
GDP at Market Prices = GVA at basic prices + product taxes – product subsidies.
Source:- Economic Survey 2019-20
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