New Delhi- India's manufacturing sector continued its growth trajectory in October, with the HSBC India Manufacturing Purchasing Managers' Index (PMI) reaching 57.5, up from 56.5 in September. This marks the strongest performance since early 2024, indicating a surge in both domestic and international demand.

According to the report, compiled by S&P Global, new orders and exports saw faster expansions in October, fueled by demand from various regions including Asia, Europe, Latin America, and the U.S. Businesses attributed the sales boost to new products and successful marketing strategies.

The increase in demand led to a rise in production, with consumer and investment goods experiencing significant growth. To meet this demand, companies increased their purchases of raw materials, with suppliers able to keep pace with the demand. This surge in activity also prompted hiring across manufacturing firms, with nearly 10% of companies reporting new job additions.

However, the report also highlights rising price pressures. Input price inflation reached a three-month high due to increasing costs of raw materials, labor, and transportation.

Pranjul Bhandari, Chief India Economist at HSBC, commented, "India's headline manufacturing PMI picked up substantially in October as the economy's operating conditions continue to broadly improve. Rapidly expanding new orders and international sales reflect strong demand growth for India's manufacturing sector."

Bhandari also noted that both input and output prices are rising due to ongoing inflationary pressures. Despite these challenges, business confidence remains robust as the third fiscal quarter begins. Many companies are optimistic about sustained consumer demand, upcoming product launches, and pending sales approvals. As a result, many have opted to raise selling prices to mitigate the impact of rising operational costs.