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The services sector's sub-sector, which is contact-intensive in nature, is still below the pre-pandemic level, the Economy Survey 2021-22 said.

Those sub-sectors are trade, hotels, transport, communication and services related to broadcasting, it said.

"The services sector, as a whole, has mostly recovered from the impact of the nationwide lockdown imposed during March-May 2020 and localised lockdowns during the second Covid wave in April-May 2021, although some of the sub-sectors continue to be impacted."

During the first half of FY22, the services sector grew by 10.8 per cent.

During the first half of 2021-22, the services sector received over $16.7 billion FDI accounting for almost 54 per cent of the total FDI inflows into the country.

The overall services sector, in terms of Gross Value Added, is expected to grow by 8.2 per cent in FY22, although the spread of Omicron variant brings in a degree of uncertainty for the near term, especially in segments that require human contact.

Further, domestic air and rail passenger traffic also increased gradually, while the global issue of container shortage impacted port traffic.