06 October,2026 01:19 PM IST | New Delhi | mid-day online correspondent
Representational Image. File pic.
India's services sector expanded at its fastest pace in three months in September to 55.2, amid strengthening domestic demand and new orders, according to news agency PTI.
"The PMI survey suggested that India's services sector continued to improve, supported by strengthening domestic demand. At the same time, export business continued to expand, although the pace of growth slowed," Pranjul Bhandari, Chief India Economist at HSBC said.
The seasonally adjusted HSBC India Services PMI Business Activity Index rose to 55.2 in September, from 54.1 in August, indicating the strongest uptick in the sector since June.
The HSBC PMI measures the month-on-month change in the combined output of India's manufacturing and services sectors and is an economic indicator of the business environment.
According to the Purchasing Managers' Index (PMI) score above 50 means expansion, while that below 50 denotes contraction.
The growth in the service sector was led by increasing demand for digital solutions, food, insurance, loans, software, transportation, and tours and travel. Besides, international demand for Indian services improved, with firms gaining from Germany, the UAE, the UK and the US. However, the PMI noted that in growth in new export business slowed to a moderate pace.
On the hiring front, improving order books and projects in the pipeline led to new recruitments during September, however, the rate of employment eased from August.
However, the expansion in September was still unable to lift the quarterly average above that seen in the previous period.
"In fact, growth over the second fiscal quarter was the weakest since the three months to March 2022," the report said.
In August, while the service sector activity had expanded, the overall pace of growth was the second-slowest recorded since March 2022, amid subdued bookings, strong competition and reduced transport operations.
The HSBC PMI further noted the cost pressures eased at the end of the quarter ended September, with the rate of input price inflation falling to its weakest levels since November 2025. Selling price inflation too eased to its lowest level since June, reducing the pressure on firms to increases their rates, as per IANS.
"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," Bhandari said.
Going ahead, Indian services companies remained optimistic about the year ahead, supported by resilient demand and rising customer enquiries.
The HSBC India Composite PMI Output Index that covers both manufacturing and services, increased to 55.9 in September from 54.3 in August, reflecting the strongest expansion in private sector since June.
The resumption of job creation in the manufacturing industry and sustained growth at service providers resulted in greater employment at the composite level.
(With inputs from PTI and IANS)
