April Composite PMI Hits 60, Business Growth At 8-Month High On Export Boost

India’s private sector growth accelerated to an eight-month high in April, driven by strong demand and a notable rise in foreign orders for manufactured goods, according to a recent survey. However, business confidence showed signs of softening.

While the data points to a strong start to the new fiscal year, maintaining momentum may prove difficult amid global headwinds, especially as US President Donald Trump’s tariffs continue to weigh on business sentiment, as per a Reuters report.

The HSBC Flash India Composite Purchasing Managers’ Index (PMI), compiled by S&P Global, rose to 60.0 in April from 59.5 in March, marking the fastest pace of combined manufacturing and services expansion since August.

A reading above 50 on the PMI indicates expansion, while anything below signals contraction.

Manufacturing PMI

April’s strong performance was largely driven by manufacturing, with the manufacturing PMI rising to 58.4 from 58.1—the highest level in a year. The services sector also showed solid momentum, with its PMI climbing to a four-month high of 59.1 from 58.5.

The overall uptick was fueled by increased new business in services and a rise in goods production and new orders, especially from international clients, highlighting robust demand.

“New export orders accelerated sharply, likely buoyed by the 90-day pause in the implementation of tariffs,” noted Pranjul Bhandari, chief India economist at HSBC. She was referring to US President Donald Trump’s April 2 announcement of broad tariffs on goods, which were subsequently deferred for 90 days.

As China grapples with steep US tariffs, India is actively positioning itself as a preferred global manufacturing hub.

A record surge in new export orders, marking the strongest growth since the index began in September 2014, was largely driven by the manufacturing sector, which saw its sharpest increase in over 15 years.

“As a result, output and employment grew, for both manufacturers and service providers,” said Bhandari.

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Workforce Expansion

With rising capacity pressures, companies continued to expand their workforce, with manufacturers reporting the highest job creation since the survey’s inception in March 2005.

While input cost inflation was mixed, accelerating in manufacturing and easing in services, strong demand enabled firms to pass these costs onto customers. As a result, selling prices rose more sharply, particularly in the manufacturing sector.

Business sentiment, however, was divided. Robust order inflows bolstered confidence among manufacturers, while a more cautious outlook in the services sector dragged overall business optimism to its lowest level in eight months.

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