India's Private Sector Sees Strongest Growth in Three Months: Report Manufacturing also remained resilient, with the HSBC Flash India Manufacturing PMI at 57.3 in November, down slightly from 57.5 in October but still indicating substantial improvement.
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India's private sector economy witnessed robust growth in November, driven by surging new business gains and export sales, as per the latest HSBC Flash PMI survey compiled by S&P Global. The HSBC Flash India Composite Output Index rose to 59.5 in November, up from 59.1 in October, marking the sharpest expansion in three months and outperforming its long-term average. The growth was led by the services sector, which recorded its highest job creation rate since the survey's inception in December 2005.
Pranjul Bhandari, chief India economist at HSBC, noted, "Strong end-demand and improving business conditions pushed services sector employment to the highest level ever recorded."
Manufacturing also remained resilient, with the HSBC Flash India Manufacturing PMI at 57.3 in November, down slightly from 57.5 in October but still indicating substantial improvement. Manufacturers outpaced service providers in new orders and output growth, with international sales playing a pivotal role. Export demand was bolstered by gains across Asia, Europe, and the Americas.
Capacity pressures and recruitment surge
Ongoing increases in new business orders resulted in heightened capacity pressures, as backlogs rose at the fastest rate since May. Companies across both sectors responded with aggressive hiring efforts. The surge in employment was particularly pronounced in the services sector, underpinned by positive demand trends and strong market confidence.
The survey also highlighted a rebound in business optimism, with the Future Output Index hitting a six-month high. Businesses cited effective marketing strategies and increased client inquiries as drivers for their improved outlook.
Amid this growth, cost pressures intensified, with the private sector experiencing the steepest rise in input prices since August 2023. Manufacturers faced higher costs for raw materials such as aluminium, cotton, leather, and rubber, while service providers grappled with escalating food and wage bills.
In response, firms raised selling prices at the fastest rate since February 2013, attributing this to robust demand enabling them to pass on costs. Bhandari added, "Price pressures are rising for raw materials used by manufacturers, as well as food and wage costs in the services sector."
Despite these challenges, the private sector remains poised for sustained growth, with demand strength and business confidence continuing to fuel momentum.
