India's services sector slows as Iran war dents demand

Softer increases in sales were noted in three of the four broad areas of the service economy

- Subhash Narayan

Despite growth slowing, the services sector saw a record increase in international orders, while input cost pressures remained at their most intense since mid-2022. AFP

(AFP)

India’s services sector grew at its slowest pace in 14 months during March, mirroring the slowdown in the growth of new business intakes, as West Asia conflict hit domestic demand, a private survey showed on Monday.

The HSBC India Services Purchasing Managers’ Index (PMI), compiled by S&P Global, fell to 57.5 in March from 58.1 in February, marking the weakest rate of expansion in 14 months but remaining above its long-run average of 54.4.

Despite the slowdown in growth, the sector saw a record increase in international orders, while input cost pressures remained at their most intense since mid-2022. While new business gains continued to underpin growth, according to panellists, output was constrained by the detrimental impact of the West Asia war on demand, market conditions and tourism, the survey said.