India manufacturing PMI rises to 54.7 in April, growth remains subdued

India's manufacturing sector saw a slight improvement in April, with the HSBC India Manufacturing PMI rising from 53.9 in March to 54.7. Despite the increase, it marked the second-slowest growth in operating conditions in nearly four years. Gains in new orders and production were modest and remained among the weakest since 2022, although exports stood out as a strong area, growing at their fastest pace since last September.

Higher demand from countries such as Australia, France, Japan, Kenya, China, Saudi Arabia, the UAE and the UK supported export growth. However, overall expansion was limited by competitive pressures, the war in the Middle East and delays in client approvals. Inflation remained a key concern, with input costs rising at the fastest rate in 44 months and output prices increasing at a six-month high.

While firms continued to purchase inputs, growth in buying activity slowed to one of the weakest levels in two-and-a-half years. Inventory levels rose only slightly. Employment increased at the fastest pace in ten months, reflecting expansion plans. Business confidence remained strong, though slightly lower than March, supported by expectations of improved demand and project approvals.

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