Mfg activity hits 16-year high in March: Survey

NEW DELHI: Activity in the country’s manufacturing sector rose to a 16-year high in March on the back of strong increase in output and new orders, which augured well for overall economic growth, a survey showed on Tuesday.
The HSBC India Manufacturing Purchasing Managers’ Index (PMI) climbed to 59.1 in March, from 56.9 in Feb. The notable improvement in operating conditions reflected stronger growth of new orders, output and input stocks as well as renewed job creation.The 50-point mark separates expansion from contraction. The survey is compiled from responses to questionnaires sent to purchasing managers in a panel of around 400 manufacturers.

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The manufacturing sector has recovered strongly after the pandemic and robust growth propelled overall economic growth with GDP expanding at a scorching 8.4% in the Oct-Dec quarter.
Growth of new orders accelerated to the quickest in nearly three-and-a-half years during March, amid reports of buoyant demand conditions. Inflows of new work strengthened from both domestic and export markets, the latter reportedly reflecting better sales to Africa, Asia, Europe and the US. New export orders increased at the fastest pace since May 2022, the survey results showed.
Manufacturing output rose for the thirty-third month running in March, and to the greatest extent since Oct 2020. Growth quickened across the consumer, intermediate and investment goods sectors. As was the case for new orders, the steepest expansion in production was seen at investment goods makers, according to the survey.
“India’s March manufacturing PMI rose to its highest level since 2008. Manufacturing companies expanded hiring in response to strong production and new orders. On the back of strong demand and a slight tightening in capacity, input cost inflation picked up in March,” said Ines Lam, economist at HSBC.

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