India's Manufacturing PMI Hits 17-Year High in August
India's manufacturing sector activity expanded at its fastest pace in 17-and-a-half years in August 2025. The HSBC India Manufacturing Purchasing Managers' Index (PMI) rose to 59.3, up from 59.1 in July. The strong performance was driven by a robust increase in new orders and production volumes, with output growth reaching its quickest rate in nearly five years. The positive data suggests sustained demand and buoyant business conditions, although growth in international orders slightly moderated amid global trade uncertainties.
Unpacked:
The record-high PMI was mainly due to a sharp rise in new orders and strong domestic demand, which boosted production volumes. Robust business sentiment and increased output also played a key role, although export order growth stayed flat amid global trade uncertainties.
India’s August 2025 manufacturing PMI of 59.8 is the highest reading since January 2008, well above the long-term average of about 53.3, and far above the pandemic low of 27.4 in April 2020.
Despite robust growth, manufacturing employment declined slightly in August 2025, though only fractionally. This suggests that productivity gains and automation may have offset the need for additional hiring.
Global trade uncertainties led to a moderation in the growth of international (export) orders for Indian manufacturers. While domestic demand surged, export order growth remained unchanged from July, indicating resilience but cautious external demand.