India Poised To End 2024 On A High Note With Robust Manufacturing And Services Growth, Hiring At Unprecedented High

Preliminary survey results revealed that India's private sector output experienced its most rapid growth in four months, contributing to a positive conclusion to 2024 for the economy. This growth was bolstered by robust demand in both the services and manufacturing sectors, along with unprecedented job growth.

The third-largest economy in Asia experienced a modest growth of 5.4 per cent in the previous quarter. However, the forecast for the coming year is more positive, as easing inflation is projected to stimulate demand among private-sector companies.

The December flash India Composite Purchasing Managers' Index (PMI) from HSBC, which is compiled by S&P Global, increased to 60.7 this month, equalling the score from August, after a decline to 58.6 in November, The Hindu reported.

The business activity index, which uses 50 as the dividing line between growth and contraction, has exceeded 60 in nearly every month of this year, with only three exceptions. This level of robustness has not been witnessed since 2008, the year of the global financial crisis, indicating a considerable expansion in the private sector.

The predominant services sector primarily exhibited a significant increase in demand, with its PMI escalating to a four-month peak of 60.8 from November's 58.4. Simultaneously, the manufacturing index also experienced growth, rising to 57.4 from 56.5 the previous month.

The surge in sales was spearheaded by service providers, as the new business sub-index reached its peak in January. An uptick in global demand for goods and services further propelled sales, with goods seeing a more rapid rise compared to services.

The enhancement in the business forecast for 2025 boosted overall positivity to its peak since September of the previous year. This surge in optimism led companies to accelerate their hiring of extra staff at a rate unseen since the inception of the survey in late 2005.

Employment generation reached a new high in both the manufacturing and services sectors. The strain of inflation lightened in December following two successive months of more significant increases. Nevertheless, companies continued to raise their selling prices, although at a rate slower than the almost 12-year peak seen in November.