Is India's Manufacturing Sector Soaring to a 14-Month High While Asia-Pacific Logistics Rents Remain Steady in H1 2025?
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Synopsis
Discover how India's manufacturing sector has surged to a 14-month high while Asia-Pacific logistics rents remain stable. This article dives into the factors driving growth amid global trade challenges.
Key Takeaways
- India's manufacturing sector has reached a 14-month high.
- Logistics rents in Asia-Pacific remain largely unchanged.
- There is a 0.4% decline in logistics rents year-on-year.
- Significant growth in international sales and employment.
- Businesses are reevaluating operational and cost strategies.
New Delhi, July 30 (NationPress) The manufacturing sector in India has reached a remarkable 14-month high, even as logistics rents in the Asia-Pacific region remained largely unchanged in the first half of 2025 (H1 2025), experiencing a 0.4 percent decline year-on-year (YoY) amid global trade uncertainties and increased caution among businesses, according to a report released on Wednesday.
According to Knight Frank's report, India's manufacturing sector saw its S&P Purchasing Managers' Index soar to 58.4 in June, marking the strongest performance in the region, fueled by a surge in international sales, increased output, and record employment growth.
Despite a notable rise in vacancies across India's three major logistics markets, rents surged by 3.4 percent in H1 2025, a significant increase from 2.1 percent just six months prior.
“The strength and stability of India's logistics sector are evident, driven by the manufacturing revival, supportive policies, and sustained interest from occupiers,” stated Shishir Baijal, Chairman and Managing Director of Knight Frank India.
As global enterprises reevaluate their supply chains, India is emerging as a strategic alternative, offering both cost advantages and a developing infrastructure base, Baijal further noted.
In contrast, rents in the Chinese mainland continue to decline, while rental growth momentum in Australia and Southeast Asia has significantly slowed, the report indicated.
Most other regional markets registered modest gains, maintaining a stable broader rent index.
According to the report, the stability observed in H1 2025 may also be a result of strategic front-loading of shipments ahead of tariff deadlines, leading to questions about future demand from occupiers.
Companies are now reassessing their operational costs and flexibilities to better optimize their logistics setups.
“As businesses evaluate their strategic priorities, real estate portfolios are increasingly being redesigned to support more resilient and regionalized supply chains,” remarked Tim Armstrong, global head of occupier strategy and solutions at Knight Frank.
This transformation includes investments in distribution hubs, proximity to ports or multimodal transit networks, and the integration of logistics infrastructure with office and support functions, he added.
While conditions in the logistics market across the region have remained stable, this stability may partly result from the strategic frontloading of shipments ahead of US tariff deadlines, as occupiers seek to advance inventory to avoid incurring additional costs, the report emphasized.
Point of View
It is imperative to recognize the resilience of India’s manufacturing sector amid global uncertainties. This report highlights the strategic advantages India holds for logistics and manufacturing, further emphasizing the need for businesses to adapt their operational strategies to thrive in a changing economic environment.
NationPress
31/07/2025
Frequently Asked Questions
What is the current status of India's manufacturing sector?
India's manufacturing sector has hit a 14-month high, with the S&P Purchasing Managers' Index reaching 58.4 in June 2025.
How have logistics rents changed in the Asia-Pacific region?
Logistics rents across the Asia-Pacific region have remained stable, with a slight decline of 0.4 percent year-on-year in H1 2025.
What factors are driving the growth of India's manufacturing?
The growth is driven by rising international sales, higher output, and record employment growth.
What challenges are businesses facing in the logistics sector?
Businesses are facing global trade tensions and are reassessing their costs and operational flexibilities.
Why is India considered a strategic alternative for global players?
India offers a cost advantage, a growing infrastructure base, and supportive policies that attract global players.
