HSBC India Services PMI®
Indian services activity expanded at a quicker rate in August 2026, with the seasonally adjusted HSBC India Services PMI Business Activity Index rising from 53.3 in July to 54.1 in August. This reading was fractionally below its long-run average of 54.5 and represented the second-weakest pace of expansion since March 2022.
Output growth strengthened from July but remained among the weakest seen in over four years, constrained by subdued bookings, strong competition, and reduced transport operations according to panel member reports. New business inflows also increased more quickly, supported by stronger customer demand and marketing initiatives, though the pace of expansion was the second-slowest in nearly four-and-a-half years due to challenging market conditions and weaker client interest in selected services.
International demand continued to support growth with new export orders rising solidly at a similar rate to July. Companies reported gains from clients in multiple international markets including Australia, Brazil, Canada, Japan, Malaysia, Singapore, Sri Lanka and the UAE, though the upturn in export sales remained below the average seen over the past year.
Employment across India's service economy reached a significant milestone, with job creation hitting a 15-month high. Approximately 11% of survey members reported higher staffing levels, which they linked to efforts to support customer service, sales and digital operations. Outstanding business fell marginally for the second consecutive month, attributed to softer inflows of new work and timely completion of incoming requests.
Price pressures showed a modest uptick in August. Input cost inflation edged up only slightly and remained moderate by historical standards, with companies reporting higher spending on digital platforms, electricity, inputs, labour, marketing and regulatory requirements. Output prices charged for services rose at the fastest rate since March as firms continued to pass on higher operating costs to clients.
The HSBC India Composite PMI Output Index stood unchanged at 54.3 in August, equal to July's reading and representing the joint-slowest growth pace in four-and-a-half years. This stability resulted from an acceleration in services growth offsetting a manufacturing slowdown. Aggregate employment increased at the fastest pace in 14 months, with job shedding at manufacturers more than offset by robust growth among services firms.
Business confidence about the year-ahead outlook was broadly unchanged from July and stayed below its long-run average, though service providers remained hopeful that market conditions and demand would improve, with technology adoption and new enquiries supporting optimism.