New Delhi: Amid buoyant demand, the Indian manufacturing sector maintained strong growth momentum at the start of the third quarter.
Rates of expansion in output and new orders were only marginally softer than in June, with firms expanding their employment and purchasing activity accordingly. Cost inflationary pressures remained relatively muted.
The seasonally adjusted S&P Global India Manufacturing Purchasing Managers’ Index (PMI) posted 57.7 in July, broadly in line with the reading of 57.8 in June. The index signalled a further substantial improvement in the health of the sector. Business conditions have now strengthened in each of the past 25 months.
Meanwhile, growth in new export business picked up to the fastest since last November. Respondents noted increases in new orders from customers in the US and neighbouring countries such as Bangladesh and Nepal.
With new orders up sharply again, manufacturers expanded production accordingly. Output has increased continuously on a monthly basis since July 2021. The latest rise was substantial, albeit the softest in three months.
The solid pace of job creation was broadly in line with those seen in May and June. This expansion in capacity was not sufficient to prevent a further build-up in backlogs of work, however, given the strength of the rise in new orders. Outstanding business increased for the nineteenth successive month, albeit only slightly.
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