The services sector growth in India reached a 13-year high in Septembers due to a sharp increase in new business and strong demand conditions, a monthly survey said on Thursday (5 October).
Additionally, job numbers continued to rise as the overall business mood improved.
The S&P Global India Services PMI Business Activity Index, which is seasonally adjusted, saw a significant increase from 60.1 in August to 61 in September, indicating a sharp upturn in output.
In terms of the Purchasing Managers' Index (PMI), a score above 50 signifies expansion, while a score below 50 represents contraction.
The survey gathers data from approximately 400 service sector companies through questionnaires.
The latest data revealed a significant increase in new business placed with Indian service providers, marking the second-fastest growth rate since June 2010.
In addition to the overall rise in sales, companies reported a surge in demand from international clients, particularly those based in Asia, Europe, and North America.
Pollyanna De Lima, Economics Associate Director at S&P Global Market Intelligence, said the latest PMI results brought more positive news for India's service economy in September.
Business activity and new work intakes reached one of the highest levels in over 13 years, De Lima added.
The survey indicated an improved outlook, with respondents forecasting favourable market dynamics and strong demand for the upcoming year. The level of positive sentiment was at its highest for over nine years.
An upturn in business optimism about the year ahead, fuelled by buoyant demand conditions, bode well for further growth across the service sector. Job creation sustained as the business mood improved.
"Services charges rose at a softer rate as cost pressures receded to one of the lowest in two-and-a-half years. Although the latter indicates that near-term output price inflation may cool, worries about potential fluctuations in food prices due to El Niño means the RBI is highly unlikely to cut rates until early next year," Lima said.
Meanwhile, the S&P Global India Composite PMI Output Index rose from 60.9 in August to 61 last month, reflecting strong demand for Indian goods and services. This led to the second-highest increase in new business in over 13 years in September, according to the survey.
The S&P Global India Composite PMI Output Index rose from 60.9 in August to 61 last month, reflecting strong demand for Indian goods and services. This led to the second-highest increase in new business in over 13 years in September, according to the survey.
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