Premji for balance between mfg and services sectors

Says services' 58% contribution to GDP equals that in developed nations, but has come by displacing manufacturing

Wipro Ltd Chairman Azim Premji today said balance should be maintained between services and manufacturing sector since the latter is witnessing displacement.

"India surprisingly has a component of services industry contributing 58 per cent of the GDP, which is equal to developed nations. Unfortunately, it has come at the displacement of manufacturing," he said here after distributing Earthian awards to school and college students.

Premji said a share of GDP which could have gone to manufacturing has not happened because of its lesser penetration in the country.

The services sector has provided a good foundation to build the economy but the country should also strive for a balance between the two sectors.

"We require more depth in manufacturing as we excessively depend on imports," he said.

"The service sector's good thing is that it is very employment generating, it is important in our country that we give thrust to areas that is employment generating," he said.

Premji said what happened to manufacturing sector 10 years ago due to globalisation was now actively happening in service industry. "As it is happening to services sector, the globalisation across the world is generating more accelerated growth in services," he added.

Young talent and less expensive tariff among the emerging countries were driving the growth of service sector, he said.

On the Centre's proposal for making profit-making companies earmark funds under Corporate Social Responsibilities (CSR), Premji said there was no clarity on the intention of the government.

He said there were two views on the cap and it may unnecessarily create 'Micky Mouse' games in terms of what the companies intend to do in this regard.

"I am not very clear of the real intentions of the government. If government wants to accelerate the companies' CSR efforts, it may lead to some short circuits," he said.