India’s services sector saw continued expansion in March, driven by strong international orders and growing business confidence. The HSBC India Services PMI report by S&P Global indicated that the Services PMI remained above its long-run average of 54.4. Despite a slight dip from 58.1 in February to 57.5 in March, the HSBC India Services PMI Business Activity Index still showed positive growth.
Companies reported a significant increase in job creation, marking the fastest pace since mid-2025, along with the most robust outlook for output in nearly 12 years. While new business gains supported this growth, output was somewhat limited by factors such as the impact of the Middle East conflict on demand, market conditions, and tourism, according to the report.
New work intake rose, albeit at a slower pace compared to January 2025, signaling softer increases in sales across various sectors like Finance & Insurance, Real Estate & Business Services, and Transport, Information & Communication. However, all these sectors experienced accelerated growth in new export orders, leading to a near-series peak in overall foreign sales growth.
The report highlighted that the service economy in India witnessed a modest growth in output during March, reflecting a slowdown in new business intakes but offset by a significant expansion in international orders. Additionally, selling charge inflation reached a seven-month high due to a notable rise in input costs, while total new order growth slowed alongside an increase in output charge inflation.
