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India's manufacturing sector regained growth momentum in the month of October, fuelled by faster increases in total new orders and international sales. An associated rise in production requirements boosted demand for raw materials, with suppliers comfortably able to deliver inputs in a timely manner. Besides, goods producers were also more willing to take on additional staff which, coupled with rising material costs, added to business expenses. Both input prices and selling charges increased at stronger rates.

According to the survey report, the seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) surged to 57.5 in October as against 56.5 in September, indicating a substantial and accelerated improvement in operating conditions. The upturn in performance was boosted by stronger demand for Indian goods. There was a quicker increase in order book volumes that was stronger than the average seen in nearly 20 years of data collection.

The survey report further noted that new export orders also exhibited stronger growth, following the weakest uptick in a year-and-a-half during September, while production volumes were ramped up to a greater degree in October, fuelled by faster increases in the consumer and investment goods categories. Meanwhile, Indian manufacturers became more optimistic regarding future output volumes. Rising since September, the level of positive sentiment was above the average seen over the 13-and-a-half-year series history.