India’s January private-sector activity rebounds as demand improves; firms step up hiring, survey shows
A flash PMI survey showed India’s private-sector growth strengthened in January 2026 on firmer demand and new orders, encouraging companies to add staff even as some measures remained below the prior year’s average.
India’s private-sector activity began 2026 with stronger momentum, as a flash purchasing managers’ index (PMI) survey indicated that growth accelerated in January on the back of improved demand. The rebound suggests that both services and manufacturing saw better conditions than in December, when activity had eased to an 11-month low.
According to the survey, the HSBC flash India Composite PMI, compiled by S&P Global, rose to 59.5 in January from 57.8 in December. Readings above 50 indicate expansion, and the move higher points to a broad-based pickup rather than a narrowly driven surge.
New orders—one of the key signals of demand—strengthened, helping lift output across both manufacturing and services. The manufacturing segment recorded a slightly faster expansion, adding to the narrative that the industrial side is still contributing meaningfully even when services remain the dominant growth engine in the broader economy.
The improved pace prompted firms to step up hiring, an important indicator because job creation often lags activity. When businesses add staff during an upswing, it can be a sign that they expect demand to hold rather than fade quickly, though surveys do not always translate directly into hard employment outcomes.
Analysts also noted nuance in the data: despite the rise in the manufacturing PMI, January’s figure remained below the 2025 average. That suggests that while momentum has returned, it is not necessarily a straight-line acceleration from last year’s best levels.
For policymakers and markets, PMI prints are watched as early signals of the economy’s direction because they arrive faster than many official statistics. If demand stays firm, it can support investment and consumption; if cost pressures rise, it can complicate the inflation outlook.
Overall, the January reading points to a positive start to 2026 for India’s private sector, with better order flows and stronger activity improving sentiment—while still leaving room for debate on how durable the upswing will be through the quarter.