February 03, 2026 08:35 am (IST)
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India’s manufacturing growth accelerates in October amid stronger domestic demand
India’s manufacturing sector gathered pace in October, buoyed by resilient domestic demand that offset a slowdown in export growth, though business optimism eased slightly from a seven-month high, according to a business survey released Monday.
The HSBC India Manufacturing Purchasing Managers’ Index (PMI), compiled by S&P Global, climbed to 59.2 in October from 57.7 in September, surpassing the flash estimate of 58.4.
A reading above 50 indicates expansion in manufacturing activity.
Production growth strengthened to match the fastest rate in five years, equal to that recorded in August.
Production growth strengthened to match the fastest rate in five years, equal to that recorded in August.
Manufacturers credited the acceleration to strong consumer demand, improved operational efficiency, new client acquisitions, and technology investments.
However, export growth showed signs of strain.
New international orders rose at the slowest pace in ten months, though the overall increase remained solid.
While input cost inflation eased to an eight-month low, selling prices stayed at a nearly 12-year high for the second month in a row.
While input cost inflation eased to an eight-month low, selling prices stayed at a nearly 12-year high for the second month in a row.
Firms cited higher freight and labour expenses, which were partly passed on to consumers, as strong demand continued to sustain elevated price levels.
“Robust end-demand supported expansions in output, new orders, and employment,” said Pranjul Bhandari, Chief India Economist at HSBC.
“Robust end-demand supported expansions in output, new orders, and employment,” said Pranjul Bhandari, Chief India Economist at HSBC.
“At the same time, input prices moderated in October, while some firms raised selling prices to offset lingering cost pressures.”
Employment in the manufacturing sector grew for the 20th consecutive month, as companies expanded their workforce to meet higher workloads, though the pace of hiring remained steady compared to September.
The future output sub-index, which tracks business confidence, dipped slightly from September’s seven-month high but remained firmly positive.
“Looking ahead, sentiment remains upbeat, supported by optimism around GST reforms and expectations of sustained demand momentum,” Bhandari added.
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