India's Manufacturing Sector Gains Momentum, Hits 10-Month High in April: PMI Data A major driver behind the recent improvement in output growth was a sharp increase in new business.
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Indian manufacturing industry rose at a sharp rate after 10 months in April 2025 on the back of strong demand and output, a recently released HSBC survey stated.
Total sales were supported by the second fastest upturn in international orders since March 2011. This upturn was accompanied by a substantial increase in employment and purchasing activity, the survey revealed.
"Despite rising only marginally from 58.1 in March to 58.2 in April, the seasonally adjusted HSBC India Manufacturing Purchasing Managers' Index (PMI) showed the strongest improvement in the health of the sector for ten months," the survey noted.
"Robust demand for Indian goods boosted firms' pricing power, with selling charges hiked to the greatest degree since October 2013. This was despite a modest uptick in input costs," it added.
A major driver behind the recent improvement in output growth was a sharp increase in new business. Although the pace remained largely unchanged from March, it was still the second-fastest expansion recorded in the past nine months. Survey respondents credited this growth to stronger demand both domestically and internationally.
The survey stated that new orders from overseas rose at their fastest pace in over 14 years, excluding a brief spike in January, marking a strong start to the 2025–26 fiscal year. Companies reported rising demand from regions including Africa, Asia, Europe, the Middle East, and the Americas.
"The notable increase in new export orders in April may indicate a potential shift in production to India, as businesses adapt to the evolving trade landscape and US tariff announcements. Manufacturing output growth strengthened to a ten-month high on robust orders. Input prices increased slightly faster, but the impact on margins could be more than offset by the much-faster rise in output prices, of which the index jumped to the highest level since October 2013," said Pranjul Bhandari, chief India economist, HSBC.
Meanwhile, input prices rose at the fastest pace in four months during April, with firms mentioning higher building maintenance, labour, leather, paper, rubber, steel and transportation costs.
"That said, the rate of inflation was moderate and below that seen for selling charges. The strength of new order inflows also led to another accumulation of outstanding business. Although slight, the rate of increase was at a 15-month high," the survey noted.
As new business picked up, companies ramped up their purchasing activity to keep pace. A big part of this increase in buying was also driven by efforts to build up inventories. In fact, input stocks rose at their fastest rate since August 2024. On the flip side, finished goods inventories saw a sharp decline, falling at the quickest pace in nearly three-and-a-half years, as firms cleared out existing stock to meet demand.
