In October, India’s services sector expanded at quickest pace since July: Survey

New Delhi, Nov 5 (KNN) In October, India’s services sector expanded at the quickest pace since July, driven by significant increase in new business orders, which in turn led to robust workforce expansion, according to a monthly survey. 

The seasonally adjusted Nikkei India Services Business Activity Index rose to 52.2 in October, from 50.9 in September. 

The services PMI recorded its rise for the fifth-straight month. In PMI parlance, a print above 50 means expansion, while a score below that denotes contraction.

“The PMI surveys brought positive news of stronger economic growth at the start of the third quarter of FY 2018/19, together indicating a welcome rebound in private sector expansion from September’s four-month low,” said Pollyanna De Lima, Principal Economist at IHS Markit, and author of the report.

"Cost pressures faded in October, but service providers continued to report rising costs, especially for food and fuel," Lima said adding that a robust expansion in workforces added to firms' expenses. 

"Firms are becoming more guarded in the face of growing uncertainties. The sustainability of current market conditions and political worries both weighed on optimism and posed downside risks to growth," Lima said. 

Improved order flows supported the pick-up in output amid favorable market conditions, greater client bases and fruitful advertising, according to panelists.

Indian service providers continued to add to their payrolls and the sector witnessed the second-strongest increase in employment since March 2011. 

The survey further noted that though the business sentiment remained positive, it was hampered by political uncertainty.