In April 2023, India’s services sector experienced robust demand, resulting in the sector’s highest growth rate in almost 13 years, according to the S&P Global India Services Purchasing Managers’ Index. The index rose to 62.0 from 57.8 in March 2023, exceeding all forecasts. Although there was a marginal increase in employment generation, international demand for the sector increased, and business optimism was at its highest level since December 2022. However, acceleration inflation created increased price pressure.
India’s manufacturing sector also showed positive growth, with the S&P Global India Manufacturing Purchasing Managers’ Index indicating the fastest expansion in the sector’s health since December 2022. In April 2023, the index rose to 57.2 from 56.4 in March 2023, reflecting favourable market conditions, demand strength, publicity, and better international sales. While inflation accelerated since March, it remained below its long-run average, and firms expanded their capacities through job creation and increased input buying.
Manufacturers are optimistic about growth prospects in India’s manufacturing sector, with production volumes expected to increase over the next 12 months. Factors contributing to this growth include rising client enquiries, contracts awaiting approval, and marketing initiatives. However, the survey showed that some raw material prices increased, leading to higher operating costs, but most companies kept their prices unchanged.
In summary, India’s Services and Manufacturing sectors showed significant growth in April, reflecting robust demand and favourable market conditions. Despite inflation accelerating, firms expanded their capacities through job creation and increased input buying. Manufacturers are optimistic about growth prospects, supported by rising client enquiries, contracts awaiting approval, and marketing initiatives.