India's services PMI expands in November, input costs see 'marked' increase

India's output in the services sector expanded at the quickest pace in three months owing to demand strength, successful marketing and a sustained upturn in sales, a private survey showed on Monday. However, companies once again saw higher operating expenses midway through the third fiscal quarter.

In addition to greater transportation costs, firms mentioned higher prices for energy, food, packaging, paper, plastic and electrical products.

The seasonally adjusted S&P Global India Services PMI Business Activity Index rose to 56.4 in November from 55.1 in October, as the new orders placed with service providers in India rose for the sixteenth straight month. Data shows that sales were boosted by favourable underlying demand and fruitful advertising.


"Indian service providers continued to reap the benefits of strong domestic demand, with PMI data for the penultimate month of 2022 showing faster increases in new business and output. Moreover, expectations of demand buoyancy in the medium-term promoted further job creation," said Pollyanna De Lima, Economics Associate Director at S&P Global Market Intelligence.

"Whilst on the whole the latest results are encouraging, the trend for inflation is somewhat concerning. Strong demand for services again boosted firms' pricing power, with more companies transferring cost increases to their customers," De Lima added.

Prices charged for the provision of services in India continued to increase in November, as companies transferred part of their additional cost burdens on to consumers. The latest rise was the twenty-first in consecutive months and the strongest since July 2017, the company said in a press release.

November data showed the first upturn in new business from abroad since the onset of COVID-19 in early 2020. However, the overall rate of expansion was mild, data show.