Services sector riddled with problems: ASCON

Double taxation, multiple regulations, lack of national standards and non-enforcement of service-level agreements are the major roadblocks for growth of the services sector, says the latest survey of the Confederation of Indian Industry8217;s Associated Council ASCON.

Improvement has seen in the air cargo transportation as the sector has reported over six per cent growth during the first quarter ended September compared to the negative growth in the first quarter of last fiscal. The sector is expected to grow by 5-10 per cent in the next six months, says the survey, and has cited high cost of airfreight, inadequate infrastructure including ground handling, warehousing and storage facilities at airports as the major problems affecting the sector. As the survey has found that hotel and tourism industry still languishing in the negative growth category, it has called for harmonisation of expenditure, sales and luxury taxes in different states to boost growth. Stating that the incentives provided in the budget has boosted the housing finance sector, the survey has stressed on the need to address the issues like absence of foreclosure laws and high stamp duties to get the desired growth rate. The sector is expected to grow by more than 30 per cent in the next six months. The survey, however, has reported an improved situation in the services sector as a whole during July-September compared to the same period last fiscal. 8220;Of the 13 sectors surveyed this year, three sectors have reported excellent growth and one high growth rate. While four sectors have recorded moderate growth this year,8221; it has said.