More and more telecommunications and computer services from India

Telecommunications and computer services comprise all telecommunications, computer and information services excluding licence fees to reproduce or distribute software. India has specialised in services in this field. The Netherlands imports relatively many of these services from India. They include, for example, companies that have software developed in India or buy technical support in hardware and software.

India is the fourth largest supplier of telecommunications and computer services after the United States, the United Kingdom and Ireland. India’s share in total Dutch imports of these services grew from 4.4 percent in 2014 to 10.3 percent in 2022. These imports from India consisted of 89 percent computer services, 10 percent information services and 1 percent telecommunications services.

Telecommunications and computer services the top import category from India since 2022

The Netherlands also imports business services from India, such as professional, management consulting and technical services. In 2022, business services accounted for nearly 43 percent of the total value of services imported from India by the Netherlands; telecommunications and computer services accounted for over 50 percent. Up to 2021, business services represented the largest category of service imports from India. Telecommunications and computer services grew substantially as of 2015, while business services contracted for several years after 2018. In 2022, both service types showed growth again compared to 2021. However, business services saw significantly lower import growth (14 percent) than telecommunications and computer services (35 percent).

Dutch service trade recovered from pandemic impact

During the onset of the coronavirus crisis in 2020, the Netherlands’ trade in services contracted significantly. The year 2021 already showed some recovery, which continued in 2022. In 2022, Dutch importers bought 250.1 billion euros worth of services from abroad. This is 18.7 percent more than in the previous year and 16.5 percent more than in 2019. Imports from India grew by a quarter to 5 billion euros between 2021 and 2022. This puts India in 11th place among major service suppliers.

Service exports above 2019 level again

The Netherlands exported 260.8 billion euros in services last year. This is 22.1 percent more than in 2021 and above the level of 2019 for the first time again. In fact, after two years of decline, exports to India grew by 45.4 percent in 2022 relative to the previous year. Dutch companies exported 1.8 billion euros of services destined for India. This mainly concerned telecommunications and computer services, transport services and business services. India is the 22nd largest export destination for the Netherlands.

Although an important part of the increase in service imports and exports also consists of price increases, India is increasingly important for Dutch service trade with above-average growth.

High earnings from service exports to India

A relatively large part of earnings from exports to India results from service exports, just as earnings from exports to the United States, for example; on the other hand, earnings from exports to a country such as China are mainly on account of goods exports. For every euro the Netherlands earned from exports to India in 2021, almost half (720 million euros) was generated by service exports and 43 percent by domestic exports. Earnings from re-exports accounted for 9 percent. The sector wholesale and commission trade earned the most from exports to India, followed by IT and information services.

Internationalisation Monitor on India

The latest edition of the CBS Internationalisation Monitor focuses on India. The publication discusses the economies of the Netherlands and India, bilateral trade in goods and services, ICT services, investment, export services and the Dutch footprint in India through consumption and use of Indian goods in the Netherlands.