“Rising from 51.5 in January to 51.8 in February, India’s seasonally adjusted index of service business activity indicated a moderate rate of expansion slightly faster than in January. The recovery was attributed by panelists to larger bookings, better demand conditions and a receding pandemic,” the IHS Markit survey noted.
“That said, the latest increase has been moderate by historical standards, with some companies indicating that growth has been held back by competitive pressures, Covid-19 and rising prices,” he added.
Reflecting the improved health of the sector, new business inflows to service providers grew faster, but were lower compared to the historical survey average. “Several companies suggested that marketing efforts, resilient demand and winning over new customers had boosted sales. There were, however, signs that growth was being hampered by input shortages, the pandemic and the election. localities,” said the service sector survey.
Demand for Indian services from international sources remained subdued in February as new business from overseas declined further in February. The rate of reduction in international demand for India’s services sector was the fastest since last September, the report said.