India Manufacturing PMI Rises to 7-Month High at 55.1 in September 2026

The manufacturing sector in India saw a pick-up in September 2026, as the HSBC India Manufacturing PMI rose to 55.1 from 52.8 in the previous month. The September number represents the highest improvement in manufacturing sector conditions in seven months. The growth in the sector was due to strong domestic demand, as well as export demand, driving up order books and production.

HSBC India Manufacturing PMI Up to 55.1

The seasonally adjusted HSBC India Manufacturing PMI increased by over two points in September to 55.1. An index above 50 signifies expansion, while an index below 50 signifies contraction.

This means that September witnessed continued expansion in India’s manufacturing sector, with the rate of expansion picking up from August. This also marks the end of three months of slowdown in growth for the manufacturing sector, Reuters reported in its survey results.

Strong Domestic and Export Orders Lift Manufacturing Output

Output and new orders expanded at a faster rate in September, as companies saw an increase in demand for their products. Sales expanded at their fastest pace since February amid stronger demand in sectors such as electronics, food, pharmaceuticals, and textiles.

The rise in export orders was also sharper. There was greater demand from markets including Brazil, Europe, UAE, and the US, helping support manufacturing output.

Employment in Manufacturing Sector Expands Once Again

There was also an increase in manufacturing employment in September, following a fall in August. The rate of job creation was said to be the sharpest since May.

This rise in hiring came despite a pickup in production and order volumes, implying that manufacturers were hiring more staff as activity improved.

Manufacturers Build up Inventories

The Indian manufacturers boosted their purchases and built up inventories in the month of September with an expectation of improved sales in the coming period.

The inventories of finished goods increased for the third consecutive month. According to the survey, this increase was the second-highest in the last 11.5 years after the increase recorded in July.

In addition to the finished goods inventories, there was an increase in purchases of raw materials for manufacturing purposes and building inventories at a pace higher than the previous month.

Manufacturers Become Confident About Future Production

The Indian manufacturers grew more confident about future production in September.

This is due to the growth in overall business confidence in September, which had grown to its highest level in four months because of a healthy pipeline of new orders.

Costs of Inputs and Sale Prices Increase

There have been price pressures throughout September, where there have been more increases in the costs of inputs and sale prices reported by manufacturers.

However, the inflation rate remained relatively low compared to other rates in history. The increase in input costs plays an important role in the data on PMI because it gives a good sign of any change in cost pressure faced by manufacturers.

What Is the Purchasing Managers Index (PMI)?

The Purchasing Managers’ Index (PMI) is a survey that measures changes in business activities in different sectors such as manufacturing and services.

For the manufacturing PMI, the data on new orders, production, employment, suppliers’ delivery time, inventories, and prices are collected from purchasing managers.