Business

Indian manufacturing industry starts 2021 with strong growth: IHS Markit

ANI | February 01, 2021 03:16 PM
IHS Markit is a world leader in critical information, analytics and solutions for major industries and markets.

New Delhi [India], February 1 (ANI): The Indian manufacturing industry enjoyed a strong start to 2021 with companies scaling up production at the quickest pace in three months, according to the latest IHS Markit Manufacturing Purchasing Managers' Index (PMI) released on Monday.

Firms were successful in their stock-building initiatives with a sharper upturn in quantity of purchases underpinning the strongest rise in input inventories in over a decade.

While employment fell further, job shedding moderated. Price pressures meanwhile intensified, driven by capacity constraints in supply chains.

The seasonally adjusted IHS Markit India Manufacturing Purchasing Managers' Index (PMI) rose from 56.4 in December to 57.7 in January to signal the strongest improvement in the health of the sector in three months.

Sustained sales growth supported a further upturn in manufacturing sector output in January. The rise in production was the sixth in successive months and the quickest since last October.

Firms noted a faster expansion in new business inflows at the start of the year, the quickest in three months. Anecdotal evidence pointed to higher sales to new and existing clients as well as the securing of bulk orders.

New orders and output rose across each of the three broad areas of the manufacturing sector. For both measures, rates of expansion picked up at consumer and capital goods firms but eased at intermediate goods makers.

Aggregate new export orders continued to increase in January, taking the current stretch of growth to five months. Moreover, the pace of expansion was solid and quickened from December.

Despite the pick-up in demand, manufacturing sector jobs decreased further in January. The pace of contraction was modest, however, and the slowest in the current ten-month sequence of reduction.

Companies that refrained from hiring mentioned the observance of government norms to keep workers to a minimum.

"An important insight from the January survey was a pick-up in inflationary pressures as lingering supply-side squeeze drove the sharpest increase in purchasing costs for over two years," said Pollyanna De Lima, Economics Associate Director at IHS Markit.

"The favourable demand environment was accommodative of price hikes and charges were raised at the fastest pace in over a year," she said.

"Companies cheered the roll-out of Covid-19 vaccines and became more optimistic towards growth prospects, a position that is supportive of investment and job creation as businesses attempt to rebuild their inventories of finished goods and meet demand needs," said De Lima.

The IHS Markit India Manufacturing PMI is compiled from responses to questionnaires sent to purchasing managers in a panel of around 400 manufacturers. The panel is stratified by detailed sector and company workforce size based on contributions to GDP.

IHS Markit is a world leader in critical information, analytics and solutions for the major industries and markets that drive economies worldwide. The company delivers next-generation information, analytics and solutions to customers in business, finance and government. (ANI)

Have something to say? Post your comment
Must Read
Night curfew in Jalandhar from Saturday amid surge in COVID-19 cases
Night curfew in Jalandhar from Saturday amid surge in COVID-19 cases
With promise of `Kaamyab & Khushal Punjab’, Capt Amarinder sets tone for future agenda
With promise of `Kaamyab & Khushal Punjab’, Capt Amarinder sets tone for future agenda
Punjab CM says Covid curbs to continue with measures to ensure minimum, if any, loss of livelihood
Punjab CM says Covid curbs to continue with measures to ensure minimum, if any, loss of livelihood
Punjab: Retired government officer promotes organic farming, direct marketing
Punjab: Retired government officer promotes organic farming, direct marketing
Agri-tech company Harvesting launches online commerce platform for farmers
Agri-tech company Harvesting launches online commerce platform for farmers
Fuel price hike: SAD MLAs ride to Punjab Assembly on bullock carts
Fuel price hike: SAD MLAs ride to Punjab Assembly on bullock carts
Fuel price hike results in increased sale of e-vehicles
Fuel price hike results in increased sale of e-vehicles
Cabinet gives approval to provide jobs to family members/heirs of 34 deceased of Amritsar rail tragedy
Cabinet gives approval to provide jobs to family members/heirs of 34 deceased of Amritsar rail tragedy
Punjab Cabinet okays to transfer 507 vacant posts of RMOs along with other para-medical and class-IV of the Subsidiary Health Centres from Rural Development to Health Department
Punjab Cabinet okays to transfer 507 vacant posts of RMOs along with other para-medical and class-IV of the Subsidiary Health Centres from Rural Development to Health Department
Hoshiarpur Police to get tough against violations of COVID Norms
Hoshiarpur Police to get tough against violations of COVID Norms
On PM-Kisan's 2nd anniversary, PM Modi says govt doing everything possible to double farmers' income
On PM-Kisan's 2nd anniversary, PM Modi says govt doing everything possible to double farmers' income
Punjab CM virtually launches Rs 1087 crores development projects under Smart City and AMRUT schemes
Punjab CM virtually launches Rs 1087 crores development projects under Smart City and AMRUT schemes