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Key Points

India's private sector is experiencing unprecedented growth this August. The composite output index reached 65.2, marking the fastest expansion since records began in 2005. Both manufacturing and services sectors showed remarkable performance with PMIs hitting multi-year highs. This surge is fueled by strong domestic demand and increased international orders from key global markets.

Key Points: India Private Sector Growth Hits Record High in August 2024

  • Composite Output Index jumps to 65.2 from 61.1 in July
  • Manufacturing PMI reaches 59.8, highest since January 2008
  • Services PMI hits record 65.6 with strong export orders
  • Growth driven by demand from Asia, Middle East, Europe and US
2 min read

India's private sector growth accelerates in August: Report

India's private sector economy expands at fastest pace since 2005 with PMI hitting 65.2, driven by surging domestic and international demand across sectors.

"The Services flash PMI touched an all-time high of 65.6, led by a sharp pick-up in new business orders - Pranjul Bhandari, HSBC"

New Delhi, Aug 22

India’s private sector economy expanded at its fastest pace on record in August, supported by a surge in new orders and resilient demand, according to a report.

The India Composite Output Index jumped to 65.2 in August, up from 61.1 in July, HSBC said in its report.

The HSBC Flash India Composite Output Index measures combined activity in manufacturing and services.

August data marked the steepest pace of growth since the survey began in December 2005, according to the report.

According to the report, India’s private sector economy posted its sharpest expansion since survey data were first collected in December 2005 during August.

The acceleration was driven by one of the strongest increases in sales volumes on record, as businesses reported buoyant domestic and overseas demand.

The report highlighted that strong inflows of new work from Asia, the Middle East, Europe, and the United States drove the acceleration.

Meanwhile, the HSBC Flash India Manufacturing PMI rose to 59.8 in August from 59.1 in July, the highest since January 2008.

The index — which tracks new orders, output, employment, suppliers’ delivery times, and inventories — signalled a quicker improvement in factory conditions.

Meanwhile, the HSBC Flash India Services PMI Business Activity Index surged to an all-time high of 65.6, up sharply from 60.5 in July, pointing to rapid expansion in services activity, the report stated.

“The Services flash PMI touched an all-time high of 65.6, led by a sharp pick-up in new business orders, both export and domestic. The Manufacturing flash PMI rose further, inching closer to the 60-mark, led by a smart rise in new domestic orders,” said Pranjul Bhandari, Chief India Economist at HSBC.

While export order growth held steady at July’s levels, margins improved as output prices increased more sharply than input costs, Bhandari added.

The strong PMI print comes as India seeks to accelerate its path towards becoming a $10 trillion economy in the coming decades.

The country’s growth strategy is increasingly centred on expanding manufacturing capacity, with sectors such as semiconductors, electronics, Electric Vehicles, renewable energy, and Defence emerging as key drivers, the report highlighted.

- IANS

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Reader Comments

P
Priya S
Great numbers but I hope this growth is inclusive and reaches smaller towns too. Sometimes these reports only reflect metro cities. Need to see rural demand picking up as well.
A
Arjun K
As a small business owner in Pune, I can confirm the demand surge. Our orders have increased 40% compared to last year. The export orders from Middle East and Europe have been particularly strong. Feeling optimistic about the future! 💪
S
Sarah B
Impressive numbers! The services PMI at 65.6 is remarkable. India's digital transformation and IT services continue to be global leaders. Hope this momentum continues through the festive season.
V
Vikram M
While the numbers look good, I'm concerned about inflation. The report mentions output prices increasing more than input costs - hope this doesn't lead to price hikes for consumers. Growth should not come at the cost of affordability.
K
Karthik V
Semiconductor, EVs, renewable energy - these are the future growth engines. Glad to see India focusing on the right sectors. With global companies diversifying from China, we have a golden opportunity to become the next manufacturing hub. Jai Hind! 🚀

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