India’s private-sector business activity expanded at its fastest pace in four months in October, driven by stronger orders and a services-led pickup, although hiring growth nearly stalled.
Bengaluru, October 23 — India’s business activity accelerated in October, with the flash Composite Purchasing Managers’ Index rising to 56.7, its strongest level in four months, according to a preliminary private-sector survey.
A reading above 50 indicates expansion, while a figure below 50 signals contraction.
The latest increase was driven mainly by stronger new orders and improved activity in the services sector, which helped push overall private-sector growth higher.
The data suggests that domestic demand remained resilient at the start of the October-December quarter.
However, the stronger pace of business activity did not translate into meaningful job creation.
Employment growth nearly stalled, as companies largely relied on their existing workforce to handle rising workloads instead of hiring additional employees.
The divergence between stronger output and weak hiring indicates that companies remain cautious about expanding payrolls even as demand improves.
Businesses may be focusing on productivity gains, capacity utilisation and existing employees before committing to additional recruitment.
The survey also showed some moderation in cost pressures.
Input-cost inflation eased across both manufacturing and services, providing some relief to companies facing elevated costs from global commodity and energy markets.
Business confidence also improved during the month, although it remained below the average level recorded so far this year.
The October PMI data provides an early indication that India’s private sector entered the latest quarter with stronger momentum.
Services remained the key growth engine, while manufacturing continued to contribute to overall expansion.
India’s economy has remained supported by domestic demand despite uncertainty in global trade, elevated crude oil prices and tighter financial conditions.
The latest figures suggest private-sector activity remains resilient, but the near-stagnation in employment will be closely watched to see whether stronger demand eventually leads companies to increase hiring.
