India's services sector growth sees slowest pace of growth in over two years in January: PMI

India's services sector growth slows in January, but remains above 50; new export business rebounds, job creation accelerates.

India's services sector activity expanded at the slowest pace in over two years in January amid softer increases in sales and output, a monthly survey said on Wednesday (February 5, 2025).

The seasonally adjusted HSBC India Services PMI Business Activity Index fell from 59.3 in December to 56.5 in January -- its lowest level since November.

In the Purchasing Managers' Index (PMI) parlance, a print above 50 means expansion, while a score below 50 denotes contraction.

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"India's services sector lost growth momentum in January, although the PMI remained well above the 50-break-even level. The business activity and new business PMI indices eased to their lowest levels since November 2022 and November 2023 respectively," Pranjul Bhandari, Chief India Economist at HSBC, said.

In contrast to the trend for total new orders, there was a quicker increase in international sales. Survey participants noted gains from clients in Asia, Europe, the Middle East and the Americas. The overall rate of expansion hit a five-month high.

"... New export business partly countered the downtrend and continued to rebound from a dip in late-2024, in line with official data which showed India's services exports shinning in December and capturing a larger share of global trade," Mr. Bhandari said.