Manufacturing Output Rises in January, Says PMI

New Delhi: After plunging to a twelve-month low in December, the manufacturing activities in India showed a significant upward movement in January, driven by resilient demand and strong output, especially in sharp rise in export orders. The HSBC India Manufacturing Purchasing Managers' Index or PMI rose to a six-month high of 57.7 in the same month from 56.4 in the previous month, a private survey showed on Monday.

In PMI parlance, a print above 50 means expansion, while a score below 50 denotes contraction. The survey, however, noted that India’s manufacturing sector growth started the year 2025 on a strong footing and touched a six-month high in January, fuelled by the steepest upturn in exports in nearly 14 years. “Goods producers attributed the substantial increase in new orders to better domestic demand and a pick-up in international sales and subsequently, manufacturers in India also continued to scale up production volumes,” the survey said.

Commenting on the survey, Pranjul Bhandari, chief India economist at HSBC, said that India’s final manufacturing PMI marked a six-month high in January. “Domestic and export demand were both strong, supporting new order growth. The employment PMI suggested robust job creation in the manufacturing industry, as the index increased to its highest level since the series was created. Input cost inflation eased for a second month, relieving pressure on manufacturers to raise final output prices,” Bhandari added.

Going forward, the survey also pointed out that companies turned more optimistic about output prospects, with nearly 32 per cent of firms forecasting growth and just 1 per cent expecting a reduction. “According to panel members, buoyant underlying demand, better customer relations, favourable economic conditions and marketing efforts all bode well for growth prospects. Robust sales gains and upbeat forecasts prompted companies to recruit additional workers at the start of the fourth quarter of this fiscal year,” the survey showed.

On the price front, the survey noted, cost pressures retreated to their weakest in 11 months, but selling prices rose solidly amid buoyant demand. “The capacity pressures among manufacturers in India remained mild. Underlying data showed that strong job creation in recent months enabled companies to stay on top of their workloads,” the survey showed.