Indian Services Hit One Year Peak

September 3, 2009 Posted by India Briefing Reading Time: < 1 minute

Sept. 3 – Business for Indian services companies grew at its fastest pace in nearly a year in August as a strong showing of new orders helped companies raise prices, according to an HSBC Markit Business Activity Index.

The index took its results from a survey of 400 firms and shows that Indian services business grew to an 11 month peak of 54.9 in August from 54.7 in July. An index score of above 50 indicates growth.

Prior to this, the index was down for six months and hit a trough of 40.3 in February. “At 54.9 it is consistent with robust, if not startling, growth of output in India’s all-important service sector,” Robert Prior-Wandesforde, senior Asian economist at HSBC told The Economic Times.

India’s service industry is an important part of the economy, accounting for more than 57 percent of the economy. The higher index rating also reflects recent news that India’s economy grew by a positive 6.1 percent from April to June. The government forecasts that the economy may expand by at least 6 percent for the 2009-2010.

The business expectations sub-index recorded its fastest expansion in 14 months at 73.09 in August, compared with 68.84 in July reported The Economic Times.