A steady increase in demand for Indian services continued to drive overall growth in new orders, international sales, and business activity in July, a report published on Tuesday said.
The HSBC India Services PMI Business Activity Index posted at 60.5 in July, slightly higher than 60.4 in June.
This small increase reflected a solid and steady expansion in output, based on the seasonally adjusted data from the report.
The growth was most marked since August 2024.
"Overshooting to 60.5, the services PMI reflected a firm growth momentum, driven by an uptick in new export orders. Future optimism increased but was lower than H1 2025," said Pranjul Bhandari, HSBC's Chief India Economist.
On the inflation front, prices for inputs and outputs recorded slightly more rapid hikes than in the last month. Yet, Bhandari indicated that this pattern might not continue, given recent trends in the Consumer Price Index (CPI) and Wholesale Price Index (WPI).
A relentless stream of new business was the primary impetus for the surge in output, said the survey. Marketing campaigns, a favorable demand climate, and the hiring of new clients spurred the high increase in new orders.
The month's surge in new business was vigorous and the second-slowest in almost one year, eclipsed only by June.
Separately, Indian service businesses saw significant increases in international orders. Companies noted winning new orders from markets such as Asia, Canada, Europe, the UAE, and the US. International sales growth was steep and was the second-quickest over the last 12 months after May.
Of the different segments, Finance and Insurance was the highest performer in new orders as well as in overall activity. The Real Estate and Business Services sector, on the other hand, showed the most modest growth rates.
The prospects among service providers are optimistic for the next year. Some of the major drivers behind this optimism are increased operational efficiency, strategic marketing efforts, technological innovations, and wider digital presence, the report said.
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