India’s manufacturing sector growth moderated in December, with the Purchasing Managers’ Index (PMI) declining to 56.4 from 56.5 in November, according to the HSBC India Manufacturing PMI report compiled by S&P Global. This marks the lowest reading in 12 months, reflecting a softer expansion in new business orders and production.
A PMI reading above 50 indicates growth, while a figure below 50 signals contraction. Despite the decline, the sector continued to expand, supported by increased purchasing activity and employment growth.
According to the report, the expansion in new orders slowed, although export orders showed improvement, growing at the fastest pace since July. Input costs rose due to higher container, material, and labor expenses, but the rate of price inflation remained moderate compared to historical levels.
Employment in the manufacturing sector increased for the tenth consecutive month, with hiring accelerating at the fastest pace in four months. The survey indicated that while most firms maintained stable workforce levels, approximately 10% expanded their staff.
Looking ahead to 2025, manufacturers expressed confidence in further output growth, citing expectations of strong demand, investment, and advertising. However, concerns over inflation and competitive pressures tempered overall optimism.
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