India’s manufacturing sector recorded its fastest expansion in nearly a year in April, with the Purchasing Managers’ Index (PMI) climbing to 58.2, slightly above March’s figure of 58.1, according to HSBC India's latest survey published on Friday. This growth surge was propelled by robust domestic consumption and a significant jump in export orders.
A PMI reading above 50 signals expansion, while a score below that threshold indicates a contraction in manufacturing activity.
The report credited the continued uptrend to stronger demand from both local and overseas markets. “Respondents attributed growth to better domestic and international demand. With the sole exception of January, new business from abroad grew to the greatest degree in over 14 years at the start of the 2025/26 fiscal year,” the survey stated.
HSBC India’s Chief Economist, Pranjul Bhandari, suggested that April’s spike in export orders could signal an emerging trend of global firms relocating production to India. This shift, she noted, may be influenced by recent developments in global trade dynamics and U.S. tariff policies.
Among the various manufacturing segments, the consumer goods sector led the charge, registering the most significant growth. A strong uptick in new orders was identified as a primary catalyst for increased output.
“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,” Bhandari explained.
The surge in manufacturing activity also led to higher employment levels. Companies increased their workforce in April to meet growing production needs, with 9% of the surveyed firms reporting new hires under both permanent and temporary contracts.
On the inflation front, the survey indicated a noticeable increase in both input and output costs. While input price inflation hit a four-month high, companies also raised their selling prices at the fastest rate seen in over 11 years, as they passed rising costs on to customers.
Confidence among manufacturers also improved. The data highlighted a significant boost in business sentiment, with many firms expressing optimism about continued demand strength and growth prospects in the months ahead.
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