India’s manufacturing sector posted robust growth in October, as the HSBC India Manufacturing Purchasing Managers’ Index (PMI) rose to 57.5, up from September’s 56.5, marking the strongest performance since early 2024. This increase underscores rising demand both at home and abroad, with a boost in new orders and production levels.

According to a report by HSBC, compiled by S&P Global, October saw accelerated growth in new orders and exports, fueled by heightened demand from Asia, Europe, Latin America, and the U.S. Businesses credited this demand to the introduction of new products and effective marketing strategies.

The demand surge spurred a rise in production, with consumer and investment goods experiencing particularly strong growth. In response, manufacturing firms increased raw material purchases, which suppliers were able to meet smoothly. This heightened activity also prompted hiring across the sector, with nearly 10% of companies adding new jobs.

However, the report noted rising price pressures. Increased costs for raw materials, labor, and transportation have pushed input price inflation to a three-month high. HSBC’s Chief India Economist, Pranjul Bhandari, noted, “India’s headline manufacturing PMI picked up substantially in October as operating conditions broadly improved, and rapidly growing new orders and international sales underscore strong demand for India’s manufacturing.”

Bhandari also highlighted that both input and output prices are climbing amid ongoing inflationary pressures. As the third fiscal quarter begins, business confidence remains high, buoyed by expectations of continued demand, product launches, and anticipated sales approvals. To offset the impact of rising operational costs, many firms have raised their selling prices.