India’s services sector saw a pick up in August as economic activity gradually improved after the government eased lockdown restrictions. However, the sector remained in the contraction zone, according to IHS Markit survey. The seasonally adjusted India Services Business Activity Index rose sharply from 34.2 in July to 41.8 in August, the highest since March, before the escalation of the global Covid-19 pandemic. Nevertheless, the latest reading, by coming in below the 50.0 neutral value again, indicated a continued decline in business activity. “Latest PMI data indicated a slower rate of decline in business activity across the Indian service sector during August. The ongoing Covid-19 restrictions continued to adversely impact client demand and business operations,” the survey said. That said, the rate of decline was the slowest in five months, it said. It said new business and output continued to contract at marked rates, albeit slower than the records seen in April and May. “Restrictions also contributed to a record increase in outstanding business. Meanwhile, sustained revenue losses through the second quarter and increasing cost burdens led companies to raise charges for the first time since March,” the survey said.
