The HSBC India Composite PMI slipped to 56.5 in March 2026 from 58.9 in February, falling short of market expectations of 58.7, according to flash estimates. This marked the slowest expansion in private sector activity since October 2022, as growth cooled across both manufacturing and services amid ongoing energy shocks.
Companies pointed to the conflict in the Middle East, volatile market conditions, and persistent inflationary pressures as the main headwinds to growth. Softer domestic demand weighed on total new orders, which rose at the slowest pace in more than three years, even as new export orders surged at a record rate.
Cost pressures strengthened, with input costs and output prices increasing at their fastest pace in 45 and seven months, respectively. Despite this, firms remained optimistic about output prospects over the next 12 months, citing planned efficiency gains, stepped-up marketing efforts, and a rise in client inquiries as key supports for their positive outlook.
