Indian economy makes strong start to 2024, says HSBC's flash survey

India grew rapidly in January, with services activity climbing to a six-month high and manufacturing picking up pace, a new flash survey by HSBC Holdings showed.

The purchasing managers index for services rose to 61.2 from 59 in December, while the manufacturing PMI increased to a four-month high of 56.9, HSBC said. The composite PMI jumped to 61. The indexes are based on preliminary survey results, with final PMI data to be published next week. A reading above 50 indicates expansion compared with the previous month, while a print below that indicates contraction in activity.

“New orders rose at a faster pace than a month ago, and within that, international orders were stronger than before,” Pranjul Bhandari, chief India economist at HSBC, said in a statement. 

India is one of the fastest-growing major economies in the world, with the government estimating 7.3% expansion in the fiscal year through March. India’s central bank governor recently said growth will likely touch 7% in the coming financial year as well. 

Services industries make up more than half of India’s gross domestic product, although manufacturing activity has recently picked up pace, providing a boost to economic growth in the July-September quarter.