The HSBC India Services Business Activity Index rose to 55.2 in September from 54.1 in August, although it remained below the 60.9 recorded in September 2025. A reading above 50 indicates expansion in activity, while a figure below that signals contraction.
However, the average services PMI (purchasing managers index) for July-September was the lowest since the quarter ended March 2022.
Also Read: GST Council to focus on auto refunds, swifter ITC, fewer notices
“The PMI survey suggested that India’s services sector continued to improve, supported by strengthening domestic demand,” said Pranjul Bhandari, chief India economist at HSBC.
Export business continued to expand, although the pace of growth moderated, she added.
ET BureauManufacturing activity had also strengthened in September, with the PMI rising to a seven-month high of 55.1 in September from 52.8 in August. As a result, India’s composite PMI, which combines manufacturing and services activity, rose to 55.9 in September from 54.3 in August, driven by a strong rise in new orders.
“The outlook remained positive, with service providers reporting improved expectations for future activity for the second consecutive month,” Bhandari said.
Also Read: New rural jobs framework notifies 375 activities
Business confidence also improved, supported by resilient demand and an increase in customer enquiries. Just under 16% of respondents expect output to rise over the next 12 months, while the remainder anticipate no change from current levels.
New orders for the services sector increased at the fastest pace in three months in September. Finance and insurance, along with consumer services, recorded the strongest expansions in both activity and sales.
Export demand for Indian services improved, with panellists citing gains from Germany, the UAE, the UK and the US. However, growth in new export business was the slowest in nearly three years.