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India's Factory Growth Hits 7-Month High on Surging Demand, Boosts Hiring
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CNBC TV18•01-10-2026, 10:54
India's Factory Growth Hits 7-Month High on Surging Demand, Boosts Hiring
- •India's manufacturing sector expanded sharply in September, ending a three-month slowdown with the fastest growth in factory activity in seven months.
- •The HSBC India Manufacturing Purchasing Managers' Index (PMI) jumped to 55.1 in September from 52.8 in August, marking the highest reading since February.
- •New orders surged, driven by strong demand for electronic, food, pharmaceutical, and textile products, with export orders also accelerating from clients in Brazil, Europe, UAE, and the US.
- •Output rose sharply, and employment expanded at its strongest rate since May, recovering from a decline in August.
- •Business confidence reached a four-month high, though input cost inflation increased, driven by higher prices for electronic components, pharmaceutical items, and steel.
Key Questions Answered
The HSBC India Manufacturing Purchasing Managers' Index (PMI) climbed to 55.1 in September, up from a five-year low of 52.8 in August.
Factory growth was driven by surging domestic and export demand, particularly for electronic, food, pharmaceutical, and textile products, alongside revived hiring and sharp increases in output.
With inflation remaining above the RBI's 4% medium-term target for the third consecutive month in August due to higher energy and food costs, the central bank is expected to raise interest rates by a total of 50 basis points this year to 5.75%.
