INDIA'S MANUFACTURING PICKS UP GROWTH ON ROBUST ORDERS, AMID INFLATION WORRY

The Indian manufacturing industry picked up growth in November, after slowing in October, as output gathered pace on strengthening client demand, more favourable input supply and boost in production volumes.

- NIVEDITA MUKHERJEE

Inflationary pressures retreated, with purchase costs rising at the weakest pace since the current sequence of increases began in August 2020, reflecting in the seasonally adjusted S&P Global India Manufacturing Purchasing Managers’ Index which swung up from October’s eight-month low of 55.5 to 56.0 in November.

A key feature of the latest results was a substantial easing of price pressures. Although average purchasing costs rose again, the rate of inflation eased to the lowest in the current 40-month sequence of increases and was negligible by historical standards. Rising costs translated into increased selling prices even though that was the weakest in seven months. Manufacturers who hiked their fees, were fewer than 7 per cent of panellists and gained on demand strength, greater labour costs and the usage of higher-quality inputs in production processes. Prices for raw materials and components still rose in November, but improved availability at suppliers amid subdued global demand for inputs led to a considerable retreat in cost pressures. Some concerns over prices increasing in the near-term were reflected in the data for business sentiment, but there was also a softer uptick in output charges amid a reduced inflationary environment.”