India’s Manufacturing and Services PMI for March 2025: Growth Continues but Services Sector Slows

India’s Manufacturing and Services Sector Performance in March

India’s business activity showed steady expansion in March 2025, with the manufacturing sector strengthening while the services sector experienced a slight slowdown. According to the latest data from S&P Global, the India Services PMI dropped to 57.7, compared to 59.0 in February. Meanwhile, the India Manufacturing PMI rose to 57.6, up from 56.3 in the previous month.

Despite the decline in the services PMI, both sectors remained in positive territory, indicating continued growth in the economy.

HSBC Composite PMI Shows Slight Dip

The HSBC India Composite PMI, which combines manufacturing and services activity, fell slightly to 58.6 in March from 58.8 in February. Although this suggests a minor slowdown, the index remains well above the 50-mark, which separates growth from contraction.

Key Insights from the PMI Data

1. Manufacturing Growth Accelerates

The manufacturing sector saw an improvement in new orders and production, reflecting strong domestic demand.

Factory activity expanded at a faster pace, showing better operating conditions compared to February.

2. Services Sector Faces Demand Pressure

The services sector, although still growing, witnessed a slowdown in new business inflows.

The decline suggests that demand in certain service industries may have weakened.

3. International Demand Slows Down

Export orders for both manufacturing and services expanded at the slowest rate in the last three months.

Global uncertainties may have contributed to the sluggish growth in foreign demand.

4. Input Costs Rise

Manufacturers reported higher input costs, reaching a three-month high in March.

The rising costs could put pressure on companies, possibly leading to higher prices for consumers in the near future.

What This Means for India’s Economy

Despite the dip in services activity, India’s economy remains in a strong position, supported by robust manufacturing growth. The increase in new orders and production signals business confidence, while rising input costs may require close monitoring.

If the services sector stabilizes and global demand picks up, India could maintain its strong economic momentum in the coming months.