Manufacturing & Services PMIs Drive Composite Index Growth

India’s services sector activity expanded to a three-month high in September 2026, driven by robust domestic demand and an acceleration in new business orders, according to the HSBC India Services Business Activity Index. The purchasing managers' index (PMI) rose to 55.2 in September from 54.1 in August, remaining comfortably above the 50-threshold that separates expansion from contraction. HSBC Chief India Economist Pranjul Bhandari highlighted that the surge was anchored by finance, insurance, and consumer services, which recorded the fastest gains in sales and operational output. Business sentiment across service providers strengthened for the second consecutive month, with roughly 16% of surveyed firms projecting higher output over the coming year on the back of rising customer enquiries and resilient domestic consumption. The broader private sector exhibited parallel strength, as manufacturing PMI accelerated to a seven-month high of 55.1 in September (up from 52.8 in August), lifting the Composite PMI to 55.9 from 54.3. While export sales in services maintained an upward trajectory—supported by client demand from Germany, the UAE, the UK, and the US—the rate of cross-border expansion moderated to its slowest pace in nearly three years. Despite a softer quarterly average for July–September compared to historical peaks, the simultaneous rebound in manufacturing and services PMI metrics underscores the enduring momentum of India's domestic market amidst broader global macroeconomic adjustments.