India’s service providers expressed optimism about future business activity, with positive sentiment based on advertising efforts, competitive pricing, and increasing client inquiries
India’s services sector experienced a significant expansion in business activity during January, according to the HSBC India PMI survey released on Wednesday. While the growth rate slowed compared to December, it remained robust, with several services companies linking the increase to strong demand conditions, new business acquisitions, and investments in technology.
The HSBC India Services PMI Business Activity Index stood at 56.5 in January, indicating a sharp expansion, although it was lower than December’s figure of 59.3. Despite this slight dip, job creation accelerated to one of the fastest rates recorded since the survey began in December 2005.
The growth in new business remained strong, driven by solid demand and competitive pricing strategies. However, some companies reported that competition was limiting the extent of growth. Notably, international sales grew at a faster pace than total new orders, with gains coming from clients in regions such as Asia, Europe, the Middle East, and the Americas.
India’s service providers expressed optimism about future business activity, with positive sentiment based on advertising efforts, competitive pricing, and increasing client inquiries. However, the level of confidence dipped to a three-month low, though it remained consistent with the trend.
Rising business activity and increased pressure on capacity led many service providers to ramp up hiring as the fiscal quarter began. However, inflation remained above the long-term average, with prices for services continuing to rise due to increased costs and strong demand. The rate of inflation accelerated in January, marking a marked increase from December.
