India’s manufacturing sector bounced back in October after dipping to a four-month low in September, supported by GST relief, higher productivity, and increased technology investments, according to a private survey. Stronger growth in new orders drove higher output and purchasing, leading to near-record expansion in input inventories.
The HSBC India Manufacturing PMI, compiled by S&P Global, rose to 59.2 in October from 57.7 in September, indicating robust expansion (above 50 denotes growth). Domestic demand was the primary driver, while export orders grew at the slowest pace in ten months, reflecting moderation in external demand. Companies attributed growth to advertising, strong local demand, and GST reforms.
Manufacturers increased purchases of raw materials and semi-finished goods at the fastest rate since May 2023, aided by easing input costs. Retail inflation dropped to 1.54% in September, the lowest since June 2017, helping contain production costs.
Despite pressure from US tariffs—amounting to about 50% on Indian exports—companies remained optimistic. Positive expectations stemmed from GST reforms, capacity expansion, and marketing efforts, with manufacturers forecasting resilient demand, future contracts, and continued growth in output, new orders, and employment.
