Services sector grew 8% in first half of FY24: Finance Ministry

Despite the slowing global economy, the services sector in India has performed well in the first half of FY24 posting growth of 8 per cent in comparison to the same period last year, a half-year economic review report by the Finance Ministry said.

“The India services PMI indicates that the sector has been expanding for 29 consecutive months, led by new business orders improving services exports,” the report added.

In the hospitality sector, while the average hotel occupancy rate was lower for the period April-September 2023 compared to the corresponding period of the previous year, the average daily rate and the average revenue per room available were 16.6 per cent and 14.1 per cent higher over this period.

As per the report, the tourism sector also displayed a trend towards revival, with foreign tourist arrivals inching up in the quarter ending September 2023, both on a sequential and annual basis.

Throwing light on the components of GVA, the industry segment grew by 9.3 per cent in the first half of FY24. This was driven by solid growth of 7.6 per cent, 9.3 per cent, and 10.5 per cent in the sub-components mining and quarrying, manufacturing, and construction, respectively.

On the manufacturing front, the report highlighted manufacturing PMI, which, as of November 2023, shows that the sector has expanded for 29 consecutive months, supported by new orders and favourable demand conditions.

“The Index of Industrial Production (IIP) has also grown by 6.1 per cent in H1 of FY24, with notable growth rates of 7 per cent and 12.4 per cent in the capital goods sector and construction and infrastructure goods sector, respectively,” the report added further.