Private Sector Growth Hits 10-month Low In December

New Delhi: India’s private sector activity hit ten months low in December as the year ended on a sombre note. It also expanded at its weakest pace in the month with a slowdown in new orders that took the steam out of both the manufacturing and services sectors. However, the overall growth remained strong, with the index staying well above the neutral mark, a private survey showed on Tuesday.

As per the data released by S&P Global, the HSBC Flash India composite output index, which measures the combined performance of India’s manufacturing and services sectors, fell to 58.9 in December from 59.7 in November. This seasonally adjusted index indicated a slower rate of expansion. A reading above 50 indicates economic expansion, while one below 50 shows contraction in the manufacturing, services, or construction sectors.

Commenting on the survey, Andrew Harker, economics director at S&P Global Market Intelligence, said that the HSBC Flash India PMI ended 2025 in positive fashion, completing a year of marked growth for the private sector. “Rates of expansion in output and new orders eased in December, but remained sharp nonetheless. Firms were helped by inflationary pressures remaining muted as the year drew to a close,” Harker added.

The survey, however, showed that the private sector saw robust business activity in the final month of 2025, albeit at a slower pace than the previous month. “The growth in new orders displayed a similar trend, maintaining healthy levels despite the deceleration. Slower rises in business activity were seen in both the manufacturing and service sectors,” the survey showed.

The weaker increases in output reflected an easing of growth in new orders, which nonetheless continued to rise sharply amid reports of improving customer demand. “While the pace of expansion in total new orders eased, the rate of growth in new export orders accelerated in December and was at a 3-month high. Panellists reported having received new orders from a range of export markets, including Australia, Bangladesh, Canada, Germany, Middle East, Sri Lanka, the UK and the US,” it said.

Inflationary pressures, the survey further said, remained muted in December. “”Input costs increased modestly, and at a pace that was only slightly faster than the near five-and-a-half-year low posted in November. In addition, the pace of inflation was slower than the series average. Mild increases were seen across both the manufacturing and service sectors,” it added.