As travel eases, services sector activity expands fastest in 10 yrs

Tribune News Service

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New Delhi, November 3

India’s services sector activity expanded at the strongest pace in 10 years due to greater consumer spending and ease of travel due to the tapering of the pandemic, said the IHS Markit India Services Purchasing Managers’ Index (PMI) survey released on Wednesday.

The seasonally adjusted India Services Business Activity Index rose from 55.2 in September to 58.4 in October due to positive performance on the manufacturing side as well. In the PMI parlance, a print above 50 means expansion.

Intakes by new services firms increased at the sharpest rate since July 2011.

For the third straight month, the services sector witnessed an expansion in output. During this period, GST collection also remained above the Rs 1 lakh-crore mark with Rs 1.3 lakh crore in October being the second highest since the launch of this composite nationwide tax.

The strong growth in the services sector, however, is powered only by domestic demand while overseas orders still remain weak. “The latest data continued to point to weak international demand for Indian services. New exports business decreased in October, a trend that has been recorded since the pandemic. But the rate of contraction was the weakest since March,” noted the PMI survey.

Index rises from 55.2 to 58.4

• India Services Business Activity Index rose from 55.2 in September to 58.4 in October
• In Purchasing Managers’ Index (PMI) parlance, a print above 50 means expansion, while a score below 50 denotes contraction