India’s manufacturing industry expanded at its fastest pace in four months in April, according to a private survey released on Monday. The S&P Global India Manufacturing Purchasing Managers’ Index (PMI) rose to 57.2 in April from 56.4 in March, with all sub-components of the index making a stronger contribution to this month’s figure. The expansion was driven by solid growth in new orders and output, signaling resilient demand and an encouraging outlook for the Indian economy. The survey results suggest that India will continue to be one of the fastest-growing major economies despite slowing global growth that has undermined momentum across several other countries.

The survey also showed that Indian manufacturers have abundant opportunities to keep powering ahead. In addition to seeing the strongest inflow of new work in 2023 so far, capacities were expanded through job creation, input buying was lifted. Both new orders and output grew at their fastest pace since December, which helped firms resume hiring during April, following the first decline in 13 months in March. Foreign demand also expanded at the fastest pace in four months in April, and optimism improved.

Pollyanna De Lima, Economics Associate Director at S&P Global Market Intelligence, said that “manufacturers are certainly upbeat towards growth prospects, with optimism improving from March’s eight-month low on the back of contracts pending approval, rising client enquiries, marketing initiatives, and evidence of demand resilience.” The overall level of positive sentiment rose since March, it said.

The survey showed that input costs rose at a faster pace in April, although improving demand meant firms were able to pass on some of that burden to customers, suggesting retail inflation is unlikely to slow significantly anytime soon. Manufacturers signaled higher operating costs in April linked to fuel, metals, transportation, and some other raw materials. However, the overall rate of inflation remained below its long-run average despite quickening since March, the company said in a statement.

India’s manufacturing industry saw expansion at the fastest rate this calendar year so far on the back of stronger factory orders and production. The PMI survey’s results suggest that India’s manufacturing sector continues to perform well and is poised for further growth. With the government’s focus on “Make in India” and “Atmanirbhar Bharat” (self-reliant India) initiatives, the manufacturing industry is expected to remain a crucial growth driver for the Indian economy in the years ahead. The survey results come at a time when India is facing the world’s worst coronavirus outbreak, which has forced many states to impose lockdowns and other restrictions. Despite the challenges posed by the pandemic, India’s manufacturing industry has demonstrated resilience and strength, and the survey results suggest that it is well-positioned for future growth.

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