India’s private sector activity improved in August, moving up from an over four-year low as services growth recovered.
The HSBC Flash India Composite PMI, compiled by S&P Global, rose to 54.6 in August from 54.3 in July, above a Reuters poll median estimate of 54.3.
Services companies led the recovery, posting a modest re-acceleration in activity and new orders after their weakest growth in 53 months in July.
Manufacturing growth kept slowing, with the HSBC Flash India Manufacturing PMI falling for a third consecutive month to 52.9, its weakest level in five years.
The composite index remained above the 50-mark separating expansion from contraction, though it stayed below the roughly 60 average recorded earlier in 2026.
The data points to a two-speed economy, with services cushioning overall growth even as factory output continues to decelerate into the final months of the year.
Job creation across India’s private sector accelerated to its fastest pace since June 2025, with the services sector leading the pickup in hiring.
Export orders continued to rise at a solid pace in August, with growth reported from markets including the United States, Germany, China, Singapore and Japan.
Input cost inflation eased to its softest level in seven months, giving companies some relief on the pricing front even as overall demand growth remained modest.
Business sentiment for the year ahead improved across both the manufacturing and services sectors compared with July, according to the survey data.
The Reuters poll of economists had pegged the composite PMI at 54.3 for August, meaning the actual reading of 54.6 came in slightly above expectations.
The PMI survey is compiled by S&P Global from responses submitted by private-sector companies each month, and is closely watched as an early indicator of economic momentum ahead of official government data.
July’s composite reading of 54.3 was itself the weakest in over four years, making August’s modest uptick to 54.6 a break from what had been a multi-month slowing trend.
Photo by Gnoeee, Wikimedia Commons, CC BY-SA 4.0
