By Admin 
- The growth of Indian services sector declined to 53.1 in July.
- Rising inflation and input costs are the main reasons for the decline.
- PMI above 50, but growth rate still slow.
India PMI Data: The pace of India’s service sector has slowed down in July 2026. During this period, India’s HSBC Flash Services PMI has fallen to 53.1, which is the lowest level since February 2022. The main reason for this is the increase in input costs along with rising inflation.
However, the index being above 50 indicates that India’s service economy is growing, but at a very slow pace. It is difficult to ignore the July figures because there has been a sharp decline in them. Services PMI was 59.8 in May, which was supported by e-commerce, entertainment, information technology and strong domestic demand. It has declined by 6.7 points in just two months.
Why is this important?
Services Purchasing Managers’ Index (Services PMI) is an important indicator measuring the health of the economy. This is important because the contribution of service sector in India’s total GDP is more than half. This sector includes many types of businesses ranging from IT and banking to restaurants, travel, transport and others, in which lakhs of people work. If the recession continues for a long time, its impact will be visible on jobs, people’s earnings and expenditure.
Why did PMI decrease in July?
There are many reasons for the fall in service PMI in July such as inflation, increase in input costs, sluggish domestic demand, geopolitical tension due to which companies faced difficult situations, many orders were cancelled, supply chain disruptions. Cost can also be a major reason for this decline. Fuel, labour, raw materials and transport have become costlier than before. However, export orders in the private sector increased, companies continued to hire people and the overall outlook remained positive.
According to Moneycontrol report, OCBC’s Senior ASEAN and India Economist Lavanya Venkateshwaran said that nothing can be said for sure based on the initial results. He said, “The Services PMI figure of 53.1 remains above the 50 level. The situation is mixed, in which rising price pressures compared to strong demand are playing a big role in weakening the sentiment.
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