India’s services PMI climbed to a five-month high of 58.8 in April, as compared to 57.5 in March, according to the HSBC India Services PMI Business Activity Index survey compiled by S&P Global.
As per the survey, Indian services companies welcomed a recovery in growth of both output and new order intakes during April.
In addition to increased e-commerce and greater underlying demand, firms indicated that a shift from international to domestic suppliers amid the war in the Middle East particularly boosted transport activity.
Pranjul Bhandari, Chief India Economist, HSBC, said activity and new orders strengthened, even as new export orders eased, suggesting that demand is rotating from overseas markets to domestic consumers amid the Middle East conflict.
He said the input cost inflation moderated but remained elevated, while output price inflation stayed subdued, indicating that some firms are absorbing higher costs rather than passing them on.
“India’s composite PMI also rose to 58.2 last month, up from 57.0 in March, pointing to renewed momentum across the manufacturing and services sectors," said Bhandari.
According to survey participants, competitive pricing, e-commerce and particularly strong customer demand for relocation and logistic services boosted sales growth. Consumer services led April’s expansion in new orders and output, followed by transport, information & communication.
Meanwhile, external sales expanded at the weakest pace in five months, dampened by the war and subdued inbound tourism, the survey stated.
With both factory production and services activity regaining some of the momentum lost in March, there was a faster expansion in Indian private sector output during April.
Furthermore, the aggregate new orders likewise rose at a quicker pace than in March and one that was above its long-run average. As was the case for output, growth of overall sales was stronger among service providers than at goods producers.
Manufacturing firms topped the rankings when it came to inflation, noting stronger increases in input costs and output charges than their services counterparts.
At the composite level, the rate of input price inflation eased from March but was the second highest since August 2023. Meanwhile, selling charges rose to the least extent in three months.
