The HSBC India Services PMI slipped to 57.2 in March 2026 from 58.1 in February, indicating a slower yet still robust expansion in the services sector. This was the weakest pace of growth since January 2025, as softer domestic demand offset otherwise resilient external conditions.
Growth in new business eased to its lowest level in three years, even as export orders climbed to a series high, supported by broad-based international demand. Activity was weighed down by geopolitical tensions in the Middle East, heightened market volatility, and persistent inflationary pressures, which also disrupted certain segments such as international travel.
On the price front, input costs increased at the fastest rate in nearly four years. Firms were able to pass on only part of these higher costs to clients. Despite the moderation in demand, employment continued to rise, with hiring expanding at its quickest pace since August 2025.
Looking ahead, business sentiment remained positive. Firms’ optimism was underpinned by expectations of improved operational efficiency, stronger marketing initiatives, and new client acquisitions, even as elevated cost pressures continue to pose challenges.
