The HSBC India Manufacturing PMI eased to 53.9 in March 2026 from 56.9 in February, coming in slightly above the flash estimate of 53.8. This signaled the weakest improvement in operating conditions in almost four years, as both factory output and new orders grew at their slowest pace since mid-2022, weighed down by rising costs, intense competition, and elevated market uncertainty linked to the conflict in the Middle East.
In contrast, employment rose at the fastest pace in seven months as firms increased headcount, and both purchasing activity and inventories continued to expand, though at a more moderate rate. Export orders recorded their strongest growth since September 2025, supported by demand from multiple overseas markets.
On the price front, input costs climbed sharply to their highest level in 43 months, while output price inflation remained contained, indicating that firms were largely absorbing the rise in operating expenses. Despite a decline in backlogs of work for the first time in nearly a year and a half, businesses grew more optimistic about production prospects over the coming year.
