New Delhi: India’s manufacturing sector experienced a modest improvement in April, although overall growth remained close to a four-year low due to subdued demand and rising input costs influenced by the ongoing Middle East conflict.
According to the HSBC India Manufacturing Purchasing Managers’ Index, compiled by S&P Global, the index rose to 54.7 in April from 53.9 in March. However, the figure was lower than the preliminary estimate of 55.9, indicating that the recovery was weaker than initially expected.
The index has remained above the 50 mark, which separates expansion from contraction, for nearly five years. Still, April’s performance highlights only a limited rebound from March’s 45-month low. Both production levels and new orders, which are key indicators of demand, increased at one of the slowest rates seen since mid-2022. Manufacturers cited multiple challenges, including intense competition, geopolitical uncertainty, and delays in order approvals, as factors affecting growth.
At the same time, cost pressures intensified, with input costs rising to their highest level since August 2022. This increase has largely been driven by higher fuel and raw material prices linked to global tensions. As a result, companies passed on some of these costs to customers, raising selling prices at the fastest pace recorded in six months.
Despite these challenges, there were some positive signs. Export demand strengthened significantly, reaching its highest level in seven months.
Additionally, firms increased hiring at the fastest pace in ten months, suggesting that businesses remain cautiously optimistic and are continuing to invest in expansion plans even amid economic uncertainty.
