India’s services sector expanded at its fastest pace in three months in September, supported by stronger domestic demand and a sharp rise in new orders, according to the HSBC India Services PMI released on Tuesday.
The seasonally adjusted HSBC India Services PMI Business Activity Index rose to 55.2 in September from 54.1 in August, signalling the strongest expansion in services activity since June.
New business also increased sharply during the month, recording its fastest growth in three months. Firms reported stronger demand for digital solutions, food, insurance, loans, software, transportation, tours and travel.
According to HSBC India, finance and insurance and consumer services recorded the strongest increases in activity and sales.
HSBC India Chief India Economist Pranjul Bhandari said the survey indicated that the services sector continued to improve, supported by strengthening domestic demand.
She added that export business also continued to expand, although the pace of growth moderated. Easing input-cost pressures reduced the need for service providers to raise selling prices.
Despite the September improvement, services activity averaged lower during the July-September quarter compared with the previous quarter, marking its weakest quarterly performance since the three months to March 2022.
International demand for Indian services also improved during September, with companies reporting stronger business from Germany, the United Arab Emirates, the United Kingdom and the United States.
However, growth in new export business slowed to a moderate pace.
Improving order books and projects in the pipeline supported further hiring by services companies during the month. Employment increased at a moderate pace, although the rate of job creation eased from August.
Input-cost pressures also moderated, with inflation in input prices falling to its weakest level since November 2025.
Selling price inflation remained moderate and eased to its lowest level since June, reducing pressure on companies to increase charges.
Business confidence among services firms also strengthened to a three-month high, with companies citing resilient demand and rising customer enquiries.
Meanwhile, the HSBC India Composite PMI Output Index, which tracks both manufacturing and services activity, rose to 55.9 in September from 54.3 in August.
The increase pointed to the fastest expansion in India’s private-sector output since June.
-PIB
