The HSBC India Services Business Activity Index, or services PMI, increased to 58.7 from 58.5 in March, indicating a surge in growth momentum for India’s service providers in April. This showed that the production of the service sector had grown significantly and more robustly. A reading of 50 implies no change, a rating below 50 suggests contraction, while a reading above 50 shows sector expansion. The headline number exceeded its long-term average of 54.2.
The Indian service sector saw a small increase in economic activity in April following a dip in March. According to the S&P Global survey, this restored momentum was primarily caused by a higher rise in new order inflows, which also supported a faster expansion in employment. This encouraging rise was accompanied by a steady increase of incomplete projects and capacity pressures.
A notable increase in new business intakes—the joint-best in eight months—fueled the overall production expansion, with many firms citing favorable demand conditions and effective marketing initiatives. According to the PMI publication, efficiency improvements in certain cases allowed businesses to take on more work.
Even while cost pressures retreated to a six-month low, typical charges rose more quickly on the pricing front. Sector-wise, the Finance & Insurance sub-sector showed the highest growth rates for both output and new orders, which were in line with patterns from the last survey period.
In terms of creating jobs, Indian service companies grew their staff in April for the 35th consecutive month. Additionally, it stated that the rate of employment creation was noticeable and faster than it was in March. Nevertheless, companies reported another monthly increase in incomplete work despite the increase in personnel levels, with the rate of backlog formation above its long-term average and rising from the previous month.
In the future, service providers reduced expectations despite expressing confidence about activity increase. Business confidence as a whole was at its lowest point in nearly two years. Positive projections were supported by advertising, strong demand, and productivity increases, but were tempered by worries about competition, the poll report said.
