India’s services sector experienced a significant uptick in February, reflected in the activity index jumping to 59 from 56.5 in the prior month, per the HSBC PMI survey released recently. This growth also boosted job creation to one of the highest levels since 2005, as companies expanded hiring to accommodate new business and alleviate capacity constraints. The employment surge was one of the most rapid since data tracking started in December 2005, demonstrating the sector’s robust performance.
“Global demand, soaring at the fastest rate in six months as per the export business index, was a key driver of India’s services sector growth, as per HSBC’s chief economist Pranjul Bhandari. International orders increased, boosting external sales speedily across various regions including Africa, Asia, Europe, the Americas, and the Middle East. This allowed service firms to exert pricing power by passing on costs, particularly affecting consumer services with rising prices.”
According to the PMI survey, out of the four service economy sectors, Consumer Services faced the most intense cost pressures, while Transport, Information & Communication companies reported the largest increase in selling charges. The survey aligns with recent official GDP data, indicating that the services sector spearheaded the economic rebound in the third quarter with growth rising to 6.2% from 5.6% in the previous quarter.
In February, the HSBC India Composite Output Index increased from 57.7 to 58.8, signaling a notable expansion. Bhandari mentioned that job creation, along with price inflation, stayed robust, and business sentiment for the future looks positive.
Positive forecasts for the upcoming year were supported by advertising, improved customer relations, efficiency gains, and strong demand. Roughly 25% of respondents predicted growth, with less than 2% expecting a decline.
Sources News From Various Digital Platforms, Websites, Journalists, And Agencies.
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