India's Private Sector Growth Gathers Pace in April after Slowdown in March

India's private sector growth accelerated its pace in April after slowing down in March amid the Middle East war.

The HSBC Flash India Composite Output Index, which comprises indices for the manufacturing and service sectors, rose to 58.3 in April from 57.0 in the preceding month, according to HSBC Flash PMI data released on Thursday.

The seasonally adjusted index, which tracks month-on-month output across manufacturing and services, remained comfortably above the 50.0 threshold, indicating expansion.

"Survey participants indicated that business activity was supported by capacity expansion, better demand conditions, rising intakes of new work and tech investment," S&P said.

New orders in April also grew at a quicker pace than in March.

Overall business conditions in April improved to a greater extent than in March indicated by the HSBC Flash India Manufacturing PMI rising to 55.9 from 53.9 in March. The HSBC Flash India Services PMI Business Activity Index, also rose marginally to 57.9 in April compared with 57.5 seen in March.

"Manufacturing led the upturn, with faster growth in output and new orders. The survey indicated that firms are building buffer stocks to manage the uncertainties around the longevity of the supply-side shock,," Pranjul Bhandari, Chief India Economist at HSBC, said.

Input cost pressures, however remained higher, and companies passed through part of the increase through higher selling

prices.

The report indicated that Indian private-sector companies expected an increase in output over the next 12 months, driven by marketing efforts which will support demand for their goods and services.

While projects pending approval and rising client enquiries also heightened optimism, the overall level of confidence fell since March, but was the second-highest in nearly a year-and-a-half.