New Delhi, Mar 2 (.) Strong domestic demand lifted India’s manufacturing activity to a four-month high in February, even as export growth cooled to a 17-month low amid lingering global trade uncertainty.
India’s manufacturing sector expanded at its fastest pace in four months in February, supported by robust domestic demand, though export growth moderated sharply, according to a survey by S&P Global. The HSBC India Manufacturing Purchasing Managers’ Index (PMI), compiled by S&P Global, rose to 56.9 in February from 55.4 in January. While the reading was slightly below the preliminary estimate of 57.5, it remained well above the 50-mark that separates expansion from contraction.
“India’s final manufacturing PMI reflected an acceleration in manufacturing activity in February. Output expanded at a faster rate for a second month, supported by stronger domestic orders,” said Pranjul Bhandari, chief India economist at HSBC.
“However, growth in new export orders continued its slowing trend that began in mid-2025, somewhat restricting employment creation in the manufacturing sector.” The data suggests Asia’s third-largest economy remains resilient in the current quarter after clocking 7.8 per cent GDP growth in the October–December period, aided by a 13.3 per cent surge in manufacturing output. For the full fiscal year ending March, India is projected to grow 7.6 per cent.
New domestic orders, a key measure of demand, rose at their strongest pace since October, driving production volumes to a four-month high. Firms attributed the uptick to efficiency gains, steady demand conditions and continued investment in technology.
However, new export orders expanded at their slowest pace in 17 months, reflecting subdued external demand and persistent uncertainty around US trade policy. The survey period (February 9–23) followed a reduction in US tariffs on Indian goods to 18 per cent from 50 per cent, though fresh global tariff measures announced last week have clouded the outlook.
On the price front, input cost inflation remained moderate and unchanged from January. Manufacturers, however, raised selling prices at the fastest pace in four months, leveraging strong demand to pass on higher costs. Employment rose to a four-month high but remained modest, with only 4 per cent of surveyed firms reporting additional hiring. Business confidence strengthened to a four-month high, signalling optimism about sustained economic growth despite weaker export momentum.
. VK PPP RSA