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India Services Growth Hits Three-Month High, Quarterly Expansion Weakens
A survey found that India’s service businesses grew faster in September than in August.
The survey score was 55.2, and a score above 50 means activity is growing.
More customers in India helped businesses receive new orders.
Orders from other countries still increased, but they grew more slowly than they had in nearly three years.
Service companies kept adding workers, though they hired more slowly than in August.
The costs businesses pay rose more slowly, and prices charged to customers also increased more slowly.
A measure combining services and manufacturing rose to 55.9.
Even so, average growth over the quarter was the weakest since early 2022.
Fewer than 16% of surveyed companies expected their output to increase over the next year.
India’s Services PMI rose to 55.2 in September from 54.1 in August, below the preliminary estimate of 55.8.
New business growth reached its fastest pace since June, supported by stronger domestic demand for services.
Export order growth slowed to its weakest pace in nearly three years, while employment continued to rise but hiring eased from August.
Input-cost inflation fell to a 10-month low, and services price inflation eased to its slowest pace since June.
The Composite PMI increased to 55.9 from 54.3, but average services and private-sector growth for the quarter was the weakest since early 2022.
- Who
- Indian services companies, as measured by the HSBC India Services PMI survey compiled by S&P Global.
- What
- Services activity accelerated in September, while average quarterly growth remained subdued.
- Where
- India.
- When
- September 2026; the survey was published on October 6, 2026.
- Why
- Stronger domestic demand and new business supported September’s growth, while weaker export momentum and slower hiring tempered the picture.
Signs of improvement
Reasons for caution
Monthly activity versus quarterly trend
Signs of improvement
September services activity grew at its fastest rate in three months, with new business expanding at its fastest pace since June.
Reasons for caution
The July-September average was the weakest since the quarter ended March 2022, indicating that the stronger monthly reading did not erase the weaker quarterly trend.
Domestic demand versus exports
Signs of improvement
Stronger domestic demand for financial, consumer and digital services supported sales and new orders.
Reasons for caution
Export-order growth slowed to its weakest pace in nearly three years, and employment growth eased from August.
Business confidence
Signs of improvement
Confidence improved to a three-month high, and service providers reported better expectations for future activity for a second consecutive month.
Reasons for caution
Confidence remained subdued by historical standards, and just under 16% of surveyed firms expected output to rise over the coming year.
Key facts
- Services PMI
- 55.2 in September, up from 54.1 in August
- Preliminary estimate
- 55.8 for September
- Expansion threshold
- A PMI reading above 50 indicates growth
- New business
- Growth was the fastest since June
- Export orders
- Growth was at its slowest in nearly three years
- Composite PMI
- 55.9 in September, up from 54.3 in August
- Input-cost inflation
- Fell to a 10-month low
- Business expectations
- Just under 16% of surveyed firms expected output to increase over the next 12 months
Quotes
Pranjul Bhandari
HSBC chief India economist
“Export business continued to expand, although the pace of growth slowed. Input-cost pressures on service providers eased to a 10-month low, reducing the need to raise selling prices,”“The outlook remained positive, with service providers reporting improved expectations for future activity for the second consecutive month.””
livemint.com
“The PMI survey suggested that India’s services sector continued to improve, supported by strengthening domestic demand.”
financialexpress.com
Sources
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