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Informist, Tuesday, Mar. 24, 2026

 

--India Mar flash manufacturing PMI 53.8 vs 56.9 Feb final 
--India Mar flash services PMI activity index 57.2 vs 58.1 Feb final 
--India Mar flash composite PMI output index 56.5 vs 58.9 Feb final 

 

NEW DELHI – Growth in India's private sector activity in March weakened to an over three-year low in the aftermath of the West Asia conflict, which has led to unstable market conditions, energy shock, and inflationary pressures. The HSBC Flash Composite Purchasing Managers' Index fell to 56.5 in March from 58.9 in February. 

 

Activity slowed down in both the manufacturing and services sectors. The flash manufacturing PMI fell to a four-and-a-half-year low of 53.8 in March from the final print of 56.9 in February. The flash services PMI fell to 57.2 in March from 58.1 in February. A PMI reading of more than 50 denotes expansion in activity from the previous month, while a print below 50 indicates contraction.

 

"Output growth eased across both manufacturing and services as the energy shock unfolds. Softer domestic demand weighed on new orders, which rose at the slowest pace in more than three years, despite a record surge in new export orders," Pranjul Bhandari, chief India economist at HSBC, said in a press release. "Cost pressures intensified, but companies are absorbing part of the increase by squeezing margins."

 

The manufacturing sector reported that the war in West Asia weighed on production growth by exacerbating market instability, driving inflationary pressures higher, and restricting demand through heightened future uncertainty among clients and end-consumers, S&P Global said in its release. Amid the raging military conflict between Iran and the US-Israel combine, India's energy supply has been hit, especially due to the blockade of the Strait of Hormuz by Iran. The price of Brent crude has jumped 43% to over $100 per barrel following the US and Israel launching a joint attack on Iran in late February.

 

As per S&P Global, price gauges highlighted intensification of inflationary pressures across India's private sector. "Input costs rose to the greatest extent in close to four years, with a range of items reported as up in price including aluminium, chemicals, electronic components, energy, food, iron ore, leather, oil, rubber and steel," the release said. While firms absorbed a large part of the extra cost burden, as indicated by a rise in selling prices that trailed the rise in input costs by a considerable margin, the rate of charge inflation was marked and the strongest in seven months.

 

Service providers also indicated a weaker upturn in business activity, and one that was the least marked since January 2025. "Anecdotal evidence particularly pointed to disruptions to international travel and the negative impact of the joint strikes by the US and Israel and Iran's counterattacks," the release said.

 

Overall, there were softer increases in new orders placed with manufacturing companies and their services counterparts in March. Collectively, their sales rose at the slowest pace since November 2022, according to S&P Global. 

 

But despite slower growth in new orders in March, private sector companies continued to expand their capacities through staff recruitment, S&P Global said. Employment rose at a moderate pace during the month. Qualitative data showed that confidence in the outlook for business activity, pending orders and pipelines of new work underpinned hiring.

 

Indian private sector firms were optimistic of an increase in output levels over the course of the coming 12 months, S&P Global said. Efficiency enhancements, marketing campaigns and new client enquiries were some of the reasons companies cited for their positive assessments.  End

 

Reported by Krity Ambey

Edited by Avishek Dutta

 

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