New Delhi witnessed a promising start to the year as India’s manufacturing and services PMI flashed strong growth signals for January. The HSBC Flash India Composite Output Index rose to 59.5, up from 57.8 in December, as revealed in Friday’s data from S&P Global.
Business conditions brightened for both manufacturers and service providers, even as inflation ticked higher. Moderating rates of input and output price increases kept inflationary pressures in check, a positive sign amid rising costs.
‘Both sectors accelerated, with manufacturing PMI rising but still below the 2025 average,’ commented Pranjul Bhandari, HSBC’s Chief India Economist. New business inflows jumped after a late-2024 slowdown, fueled by robust domestic and external demand.
Goods producers faced steeper input cost hikes compared to services, yet sales volumes expanded rapidly thanks to heightened marketing efforts and client demand. Manufacturing led the charge in growth pace over services.
A standout feature was the robust rise in new export orders—the highest in four months—targeting buyers across Asia, Australia, Europe, Latin America, and the Middle East. Employment stabilized with fresh hiring after December’s pause, reflecting renewed confidence.
Private sector firms remain bullish on the year ahead, with survey optimism peaking on expectations of sustained activity. This data underscores India’s economic vigor, positioning it as a bright spot in global markets amid uncertainties.