NITI Aayog Report on India’s Professional Services
Why in News?
NITI Aayog released India’s Services Sector: Insights on Regulatory Regime in Professional Services. The report examines regulatory barriers affecting India’s knowledge-intensive professional services. It covers legal, accounting, architecture, engineering and healthcare services.
The report seeks to improve professional mobility, services exports and India’s competitiveness in global value chains.
About NITI Aayog Report on India’s Professional Services
What is the Report’s Key Finding?
India’s services sector contributes around 55% of GDP and GVA and accounts for nearly 30% of employment. Professional and management consulting services formed about 20% of India’s services exports in 2024–25.
India’s Revealed Comparative Advantage in professional and management consulting increased from 0.95 in 2005 to 3.0 in 2024. India also became the world’s 7th-largest services exporter, with a 4.3% share of global services exports in 2024.
However, regulatory fragmentation continues to restrict growth and professional mobility.
What are the Major Regulatory Challenges?
The OECD Services Trade Restrictiveness Index (STRI) highlights significant restrictions in some professional services.
| Sector | India’s Position |
|---|---|
| Architecture | 2nd most restrictive |
| Legal services | 3rd most restrictive |
| Accounting | 4th most restrictive |
| Engineering | 38th most restrictive |
Legal professionals face restrictions on corporate structures and multidisciplinary practices. India also lacks broad Mutual Recognition Agreements (MRAs) with foreign professional bodies.
Accounting faces overlapping regulatory responsibilities between ICAI and NFRA. Engineering lacks a comprehensive statutory framework for professional practice.
Architecture faces restrictions on business structures and additional state-level compliance requirements. Healthcare also faces interstate registration barriers and regulatory overlaps.
How Can India Strengthen Professional Services?
NITI Aayog’s Four-Pronged Strategy
The report recommends:
- Continuous Professional Development (CPD) through uniform requirements.
- Greater regulatory harmonisation and transparency.
- Wider Mutual Recognition Agreements for international mobility.
- Modern business structures and multidisciplinary practices.
- Adoption of global regulatory best practices.
- Greater use of AI and automation.
- Moving towards high-value, knowledge-intensive services.
The report also highlights India’s approximately 1,700 Global Capability Centres, which employ over 1.9 million professionals.
Related Information
Under the General Agreement on Trade in Services (GATS), services trade occurs through four modes: cross-border supply, consumption abroad, commercial presence and presence of natural persons.
The report links regulatory reform with India’s ability to increase services exports, high-skilled employment and participation in global value chains.
NITI Aayog Report on India’s Professional Services Exam-Oriented Facts
- Report: India’s Services Sector: Insights on Regulatory Regime in Professional Services.
- Institution: NITI Aayog.
- Major sectors: Legal, accounting, architecture, engineering and healthcare.
- India’s global services-export rank: 7th.
- Global services export share: 4.3% in 2024.
- Professional consulting RCA: 3.0 in 2024.
- Key recommendation: Regulatory harmonisation.
- CPD: Continuous Professional Development.
- MRA: Mutual Recognition Agreement.
- GATS modes: 4.
- Key objective: Higher services exports and global competitiveness.
- Emerging areas: AI, automation, green transition and specialised advisory services.
