The seasonally adjusted HSBC Business Activity Index fell from 51.4 in March to 50.7, pointing to marginal growth in service sector activity that was the slowest in the current one-and-a-half year expansionary period.
Moreover, the index fell considerably from the average reading registered in Q1 2013 (54.3). Companies mentioned that slower activity growth reflected weaker gains in incoming new work.
"New business placed at services and manufacturing firms in India rose during April. However, the rates of expansion eased in both cases, with manufacturers citing powercuts and service providers mentioning extreme weather and challenging market conditions.
Subsequently, incoming new work across the private sector expanded moderately, and at the slowest pace in 17 months.Staffing levels in the Indian private sector rose during April. That said, the rate of job creation was modest and
the slowest in the current 14-month sequence of hiring. Growth in payroll numbers eased in both the manufacturing and service sectors," the HSBC PMI release states.
April data pointed to higher backlogs of work in the Indian private sector. The rate of accumulation was, however, marginal and the slowest in seven months. Service providers stated that delayed payments from clients had resulted in increased levels of unfinished business, whereas manufacturers linked the accumulation to persistent powercuts.