Mint reports, business activity among Indian services companies expanded at its fastest pace in 16 months in January, rising for a second straight month on sharp increase in new work orders, a survey showed.
The HSBC Markit Business Activity Index, based on a survey of 400 firms, rose to 58.96 in January, its highest since September 2008, after rising to 57.41 in December.
This is the second successive rise in the index, which has been above 50 that separates expansion from contraction for nine months as the economy shakes off the impact of the global slowdown.
Before that, it had shrank for six months, hitting a trough of 40.3 in February last year.
“The key business activity index continued its march deeper into expansionary territory in January and is once again consistent with double-digit output growth in India’s service sector,” said Robert Prior-Wandesforde, senior Asian economist at HSBC.
“With the manufacturing PMI also strengthening further over the last couple of months the ex-agriculture segment of the economy looks to have well and truly shaken off the spillover effects from a drought-ravaged agricultural sector,” he said.
India’s manufacturing in January grew at its fastest pace in almost 18 months boosted by a sharp rise in new export orders that underpin a recovery in the industrial sector, the HSBC Markit survey showed.
The business expectations sub-index snapped a two-month fall and rose to 66.58 in January from 65.56 in December.
Favourable market conditions, advertising campaigns and strong reputations for quality were the key reasons for positive sentiment given by respondents, HSBC said.
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