India's manufacturing PMI hits 10-month high of 58.2 in April, IIP rebounds

India's manufacturing sector reached a 10-month high in April 2025, with the HSBC India Manufacturing PMI inching up to 58.2 from 58.1 in March, indicating strong sectoral health. This improvement, the strongest since June 2024, was driven by a surge in export orders—especially from Africa, Asia, Europe, West Asia, and the Americas—as well as faster production and inventory buildup. Hiring rose, with about 9% of manufacturers expanding their workforce. The rise in manufacturing activity, particularly in the consumer goods segment, is being interpreted as a possible shift in global supply chains toward India amid changing trade dynamics and U.S. tariff policies.
Supporting this momentum, India’s Index of Industrial Production (IIP) saw a 3% rise in March, aided by growth in electricity output and a modest recovery in manufacturing, though mining remained weak. Despite this, IIP growth for FY25 slowed to 4%, the lowest in four years. To support growth, the RBI cut the repo rate to 6% in April—the second rate cut this year—and adopted an “accommodative” stance, hinting at further easing. The PMI’s forward-looking nature, along with the RBI’s policy moves, signals cautious optimism for India’s industrial and economic trajectory.

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