Mumbai, May 6 Weak demand conditions eased the growth of India’s service sector output during April, according to the Nikkei India Services Business Activity Index.
The index report on Monday showed that during last month India’s service sector lost momentum with rates of new business and output growth both cooling to seven-month lows.
The seasonally adjusted index fell from 52 in March to 51 at the start of the 2019 financial year, the weakest upturn in output since last September.
An index reading of above 50 indicates an overall increase in economic activity and below 50 indicates an overall decrease.
Consequently, with growth of manufacturing production also softening to a seven-month low, the seasonally adjusted Nikkei India Composite PMI Output Index also fell from 52.7 to 51.7 in April.
“Although the Indian private sector economy looks to be settling into a weaker growth phase, much of the slowdown was linked to disruptions arising from the elections and companies generally foresee improvements once a government is formed,” said Pollyanna De Lima, Principal Economist at IHS Markit and author of the report.
“However, voting was not the only reason cited for the slowdown. In the service sector, competitive conditions and a shift towards online bookings among customers reportedly restricted new business gains and in turn growth of activity,” she added.