(March 24): India’s economic activity slipped slightly in March as a pickup in manufacturing was offset by slowing services sector demand, a flash survey by HSBC Holdings plc showed.

The manufacturing purchasing managers’ index improved to 57.6 in March from 56.3 in the previous month, while the services purchasing managers’ index fell to 57.7 from 59 in February. That resulted in the composite index falling to 58.6 in March from 58.8.

The indexes show business confidence in the economy and are based on preliminary surveys. The data could get revised when final PMI figures are released next week. A reading above 50 indicates expansion in economic activity, while a print below that indicates contraction.

While India’s manufacturing sector output index climbed to its highest level since July 2024, the margin squeeze intensified for firms as input cost pressures ticked up, said HSBC chief India economist Pranjul Bhandari in a statement Monday. “The moderation in new export orders growth was also noteworthy amid tariff announcements,” she said.

Growth risks are mounting for the Indian economy as US President Donald Trump said the South Asian nation won’t avoid being hit by like-for-like duties from April 2. India’s expansion of 6.5% in the fiscal year ending in March is already the weakest pace since the pandemic.

To spur activity, the Reserve Bank of India lowered its benchmark rate for the first time in almost five years last month and economists expect a further reduction in April.

New export order growth eased to a three-month low but remained above the average, HSBC said. Manufacturing companies registered a faster upturn in new business from abroad than their services counterparts, it added.

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