Mumbai :  India's services industry including transportation and telecommunications expanded for a 13th straight month in May as pressure mounts on the central bank to raise interest rates and curb inflation.

The HSBC Holdings Plc and Markit Economics' Purchasing Managers' Index was 58.2 versus 62.1 in April, according to an emailed report yesterday. A reading above 50 indicates an expansion.

The figures are the latest economic data released in India this week that indicate strengthening consumer demand, boosting chances of inflation accelerating. India's economy expanded 8.6 per cent last quarter, the fastest pace after China among major economies, while manufacturing in May grew the most in more than two years.

"PMI fell in May, but it still implies rock-solid growth," Frederic Neumann, a Hong Kong-based economist at HSBC, said in the report. "The reading points squarely at the need for the Reserve Bank of India to tighten screws."

Central bank Governor Duvvuri Subbarao has raised rates twice since mid-March. The bank's benchmark reverse-repurchase rate is 3.75 per cent while wholesale-price inflation is 9.59 per cent.

Inflation high

Food-inflation rate climbed to a five-week high of 16.55 per cent in the week ended May 22 from a year earlier, a separate government report showed yesterday.

The Reserve Bank last month signalled plans to raise borrowing costs "cautiously" as the European debt crisis threatens global economic growth.

Services make up about 55 per cent of India's $1.2 trillion economy, according to finance ministry data.

Wireless telecom firms including Bharti Airtel Limited added 17 million new customers in April, about 3 per cent more than the previous month, according to the Telecom Regulatory Authority of India. The number of passengers flying on domestic airlines such as Jet Airways (India) Limited rose 7.3 per cent in April from the previous month, the civil aviation ministry said.

The Purchasing Managers' Index for manufacturing rose to 59, the highest since February 2008, HSBC and Markit Economics said earlier this week.