India’s economy experienced record growth in August 2025, with private sector activity expanding at the fastest pace ever recorded.
A report by HSBC and S&P Global revealed that the India Composite Purchasing Managers’ Index (PMI) rose to 65.2 in August. This is up from 61.1 in July and marks the highest level since the survey began in December 2005.
The PMI reading stayed well above 50 for the 49th straight month, signaling strong and ongoing economic expansion.
The growth was driven mainly by the services sector, which saw its activity index hit a new high of 65.6. The manufacturing sector also performed strongly, with its PMI climbing to 59.8, the highest since January 2008.
Demand was a key driver of this boom. The report noted the sharpest increase in new orders in nearly 18 years. Export demand was also strong, rising at the fastest pace since data collection began in 2014.
This strong demand gave companies the confidence to increase prices, leading to the biggest price hikes in over 12 years. Rising wage costs and expensive raw materials were passed on to consumers.
While this shows the strength of India’s economy, it also raises concerns about inflation. The Reserve Bank of India (RBI) may hold off on cutting interest rates due to rising price pressures.
Job creation also improved, with businesses hiring at the fastest rate since June. Companies remain confident, with optimism for the coming year reaching its highest level since March.
Experts say India is now one of the fastest-growing major economies, supported by domestic demand and strong business confidence.
In other related news also read US Postpones Trade Talks with India Amid Diplomatic StrainsIndiaUS Postpones Trade Talks with India Amid Diplomatic Strains
