India’s Manufacturing Sector Hits 10-Month High In April On Strong Export Demand
India’s manufacturing sector reached a 10-month high in April 2025, with the HSBC India Manufacturing Purchasing Managers’ Index (PMI) inching up to 58.2 from 58.1 in March, according to data released by S&P Global. Despite the modest increase, the seasonally adjusted PMI signaled the strongest improvement in manufacturing conditions since June 2024, driven by faster growth in production, employment, and purchasing activity.
This marks a solid rebound from February’s 14-month low of 56.3, when output and new orders had slowed.
Surge In Export Orders Fuels Growth
The improvement was largely supported by a sharp rise in new orders, particularly from international markets. Overseas demand increased at the second-fastest pace in over 14 years, with buyers across Africa, Asia, Europe, West Asia, and the Americas boosting orders for Indian goods. As a result, production expanded at its fastest pace since June 2024, with consumer goods leading the way.
Commenting on the data, HSBC Chief India Economist Pranjul Bhandari said, “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.”
Firms Hire, Build Inventory On Optimism
About 9 per cent of manufacturers hired additional staff, both permanent and temporary, to meet rising demand. Companies also increased input purchases and built up inventories in anticipation of continued growth. Surveyed firms reported stronger confidence about future output, citing higher expected demand, better marketing strategies, improved efficiency, and a rise in customer inquiries.
Industrial Output Recovers Slightly In March
India’s industrial output showed a modest recovery in March. The Index of Industrial Production (IIP) rose 3 per cent, up from February’s six-month low of 2.72 per cent. However, IIP growth for FY25 slowed to 4 per cent, marking the weakest expansion in four years, down from 5.9 per cent in FY24. The overall deceleration highlights subdued performance across multiple industrial segments.
March’s growth was supported by a 6.3 per cent rise in electricity generation and a 3 per cent uptick in manufacturing, while mining output remained sluggish, growing just 0.4 per cent. For comparison, IIP had grown 5.4 per cent in March 2024 and contracted 8.4 per cent during the pandemic-impacted FY21.
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