India’s private sector activity edged slightly higher in August from an over four-year low as a rebound in services growth offset the weakest expansion in the factory industry in half a decade, a survey showed.
HSBC’s flash India Composite Purchasing Managers’ Index (PMI), compiled by S&P Global, rose to 54.6 in August from July’s 52-month low of 54.3, higher than a Reuters poll median estimate of 54.3.
While the reading stayed above the 50 mark separating growth from contraction, it remained below the recent average of around 60.
New orders – a key gauge of demand – grew at a faster pace but remained weak compared to the long-term average. Companies cited challenging market conditions, competitive pressures and lower customer requirements as constraints. Export orders growth, however, slowed from July.
Services – the dominant sector – drove this month’s rebound. The headline PMI rose to 54.5 in August from a 53-month low of 53.3 in July. Manufacturing PMI fell for the third consecutive month to 52.9 from 53.5, its lowest since August 2021. Both goods output and new orders grew at their weakest pace in five years.
Staffing in manufacturing fell for the first time in 2-1/2 years. Overall employment, however, accelerated to its joint-fastest pace since June 2025 driven by a 15-month-high growth in services-sector hiring.
Overall input cost pressures eased to a seven-month low, but firms raised their selling prices at the fastest rate since April in efforts to pass higher costs on to customers.
Business confidence for the year ahead edged higher in August. The degree of optimism, however, was more modest compared to early 2026.
