Manufacture or service: Must we choose?

This debate is futile in India's development journey

The structural transformation followed by most developed countries, and those that developed later like Korea and China, and now Vietnam, was to first industrialise and then develop services, shifting millions out of agriculture. In India’s case, this structural transformation became lop-sided. India suffered what Dani Rodrik called “premature de-industrialisation”, with the share of industry peaking in 2008 at around 32 per cent of gross domestic product (GDP), and then falling to around 25 per cent of GDP. In contrast, India did remarkably well early on in services, especially IT-related, and now also in health care and e-services. This has led