India's Manufacturing Sector Witnesses Highest Expansion In Over 17 Years: HSBC PMI For August

In August 2025, the manufacturing sector experienced its most rapid expansion in over 17 years, a surge driven by an increase in new orders and production, as reported by a private sector survey.

The HSBC India Manufacturing Purchasing Managers’ Index (PMI) surged to 59.3 in August from 59.1 in July, suggesting the “fastest improvement in operating conditions for 17-and-a-half years”, as per the report.

The charts incorporated in the study indicate that the last time India's manufacturing PMI was at a higher level was in the middle of 2008.

“Indian manufacturing growth gained further momentum in August, with ongoing improvements in demand continuing to underpin robust increases in factory orders and production,” the report was quoted as saying.

“Companies upped the pace at which additional materials were bought, and more jobs were created, partly reflecting positive expectations regarding the outlook,” it added.

The text further clarified that the increase in the primary PMI number was a result of a boost in production volume growth. This growth was the fastest it had been in nearly five years.

“Incoming new orders rose to broadly the same extent as in July, which was the fastest in 57 months,” the report said. In addition to demand buoyancy, growth was attributed to advertising success by survey participants.

Significantly, the report emphasised that the base data indicated a decelerated growth in global orders received by Indian manufacturers, experiencing the most sluggish rate of increase in the past five months.

“The increase of US tariffs on Indian goods to 50 per cent might have contributed to the slight easing in new export orders growth, as American buyers refrain from placing orders in the midst of tariff uncertainty,” Chief India Economist at HSBC, Pranjul Bhandari, said.