Is India’s Manufacturing PMI Continuing to Expand Amid US Tariffs?
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Synopsis
The recent PMI data reveals India’s manufacturing sector is thriving despite challenges from US tariffs. With growth indicators above trend, analysts express cautious optimism, highlighting the impact of external factors on business confidence.
Key Takeaways
- PMI rose to 56.6, indicating strong manufacturing growth.
- Inflation rates decreased, with input costs rising slowly.
- Challenges from US tariffs are impacting business confidence.
- Manufacturers attribute growth to competitive pricing and demand trends.
- Despite a slowdown, long-term optimism remains.
New Delhi, Dec 1 (NationPress) The manufacturing sector in India has once again demonstrated remarkable growth, with new orders and production levels rising at rates exceeding expectations, as reported by the HSBC India Manufacturing Purchasing Managers’ Index (PMI) on Monday.
The PMI for November stood at 56.6, well above the neutral threshold of 50.0 and the long-term average of 54.2, as per data from S&P Global.
Although this figure marks a decline from 59.2 in October, it indicates the slowest improvement in operational conditions since February, according to the report.
Inflation rates saw a decline in November, with input costs and selling prices increasing at the slowest rates in nine and eight months, respectively.
Pranjul Bhandari, Chief India Economist at HSBC, noted that “the final November PMI results confirmed that US tariffs have contributed to the slowdown in manufacturing growth.”
The new export orders PMI fell to a 13-month low, and business confidence regarding future output expectations also saw a decline in November, potentially due to rising concerns about the effects of tariffs.
Manufacturers in India reported a significant increase in order volumes, credited to competitive pricing, positive demand trends, and heightened client interest.
Despite overall growth easing to a nine-month low amidst reports of difficult market conditions and delays in project initiation, the report indicated that the international sales trend remained positive, with increased sales to clients across Africa, Asia, Europe, and the Middle East.
However, downgraded forecasts were attributed to a competitive landscape, including competition from global firms, as indicated by anecdotal evidence.
Despite these challenges, companies maintained optimism regarding output growth over the next 12 months, according to the report.
Point of View
It is crucial to recognize the resilience of India’s manufacturing industry amid external pressures, such as US tariffs. While growth rates may be slowing, the overall trend remains positive, signaling a dynamic sector ready to adapt and thrive in challenging environments.
NationPress
01/12/2025
Frequently Asked Questions
What is the current manufacturing PMI for India?
The current manufacturing PMI for India is 56.6 for November.
How does the PMI indicate manufacturing performance?
The PMI is a single-figure indicator; values above 50.0 indicate expansion, while values below suggest contraction.
What factors are contributing to the slowdown in manufacturing growth?
The slowdown is attributed to US tariffs and concerns about competitive pressures in the market.
What is the significance of the new export orders PMI?
The new export orders PMI has fallen to a 13-month low, indicating challenges in international demand.
Are manufacturers optimistic about future growth?
Yes, manufacturers remain confident about increased output over the next 12 months.
