India's manufacturing sector displayed remarkable resilience and strength in October 2024, with growth momentum accelerating to one of the fastest paces recorded in over three years, according to the latest HSBC India Manufacturing Purchasing Managers' Index (PMI) data.
Robust PMI Figures Signal Strong Expansion
The seasonally adjusted HSBC India Manufacturing PMI rose to 58.5 in October, up from 57.5 in September, firmly positioned above the critical 50-mark that separates expansion from contraction. This represents one of the most substantial improvements in operating conditions across the manufacturing sector since early 2021.
Domestic Demand Powers Growth Engine
The primary driver behind this manufacturing resurgence has been exceptionally strong domestic demand, which more than compensated for relatively subdued export orders. Companies reported the fastest increase in new orders since December 2020, indicating robust consumption patterns within the Indian market.
Production and Employment Surge
Factory production expanded at the quickest rate in five months, with manufacturers scaling up output to meet growing order books. The employment scenario also showed positive trends, with job creation reaching its highest level since September 2022 as companies expanded their workforce to handle increased production requirements.
Key Sector Highlights:
- New orders grew at fastest pace in nearly four years
- Production volumes increased significantly
- Employment generation reached two-year high
- Business confidence remained strongly positive
- Input cost inflation moderated during the period
Business Confidence Hits 9-Month High
Manufacturers expressed heightened optimism about the year-ahead outlook for production, with business confidence climbing to a nine-month peak. Companies cited expectations of continued demand strength, advertising efforts, and client inquiries as reasons for their positive sentiment.
The sustained manufacturing expansion positions India as one of the fastest-growing major economies globally, with the sector continuing to demonstrate its capacity to drive economic growth despite global headwinds affecting other emerging markets.
