Mumbai,  Outbreak of Covid-19 decelerated the growth of India's service sector activity in March, an economic data point showed on Monday.

Accordingly, the IHS Markit India Services Business Activity Index fell to 49.3 in March, down from February's 85-month high of 57.5.

An index reading of above 50 indicates an overall increase in economic activity and below 50, an overall decrease.

"The global COVID-19 pandemic reportedly led to a fall in new orders from clients, particularly overseas. That said, the decrease in output was mild overall. March data were collected between March 12-27," IHS Markit PMI report said.

Similarly, deceleration in manufacturing production with a slowdown in services activity dipped the growth slows to marginal pace in March.

Consequently, the Composite Output Index fell to 50.6 in March, down seven points from February's 57.6 "to signal a sharp slowdown in private sector output growth and bringing an abrupt end to the recent strong upward-moving expansion trend".

The index is a weighted average of the Manufacturing Output Index and the Services Business Activity Index.

Commenting on the latest survey results, Joe Hayes, Economist at IHS Markit, said: "Strong growth momentum seen so far in 2019 was halted in March as demand conditions deteriorated, particularly overseas, leading to a reduction in business activity."

"Clearly, the worse is yet to come as nationwide store closures and prohibition to leave the house will weigh heavily on the services economy, as has been seen elsewhere in the world. Pressure now fully lies on the government to combat the economic challenges the lockdown will cause."