India’s Manufacturing Sector Surges to 17-Year High in August

New Delhi, Sep 1 (KNN) India’s manufacturing industry recorded its fastest expansion in more than 17 years in August 2025, highlighting strong domestic demand despite global trade challenges.

The HSBC India Manufacturing Purchasing Managers’ Index (PMI), compiled by S&P Global, rose to 59.3 in August from 59.1 in July. This marks the highest reading since early 2008, signaling a sharp improvement in operating conditions and robust business momentum.

The surge was driven mainly by faster production growth, the strongest in nearly five years. New orders also stayed firm, maintaining July’s 57-month high pace. Companies attributed this momentum to buoyant local demand and effective marketing strategies.

On the global front, export orders rose at a slower rate, hitting a five-month low. The slowdown was largely linked to the U.S.’s steep 50% tariffs on Indian exports. 

However, Indian manufacturers continued to secure business from markets in Asia, Europe, the Middle East, and the U.S., reflecting resilience in overseas demand.

Domestically, the outlook remained upbeat. Companies scaled up input purchases at a 16-month high, rebuilt inventories, and expanded output significantly. Employment rose for the 18th straight month, though hiring slowed to its weakest pace since November 2024.

Inflationary pressures persisted, with input and output prices rising. However, strong demand allowed firms to pass on higher costs to consumers. 

Business sentiment also improved, rebounding from a three-year low in July, signaling renewed confidence in the sector’s growth prospects.

Overall, India’s manufacturing sector showed remarkable strength in August, supported by domestic demand and production growth, while navigating external pressures from global trade dynamics.

(KNN Bureau)