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India's Manufacturing PMI Rebounds in January 2026 on Stronger Orders

India's manufacturing sector regained momentum in January 2026, with the HSBC PMI rising to 55.4 from December's two-year low. The rebound was driven by faster growth in new orders, output, employment, and purchasing activity. While input costs rose at the fastest pace in four months, the growth in selling prices eased, creating slight margin pressure for producers. Despite the stronger activity, business confidence for future output declined to its lowest level since mid-2022.

Key Points: India Manufacturing PMI Rises to 55.4 in January 2026

  • PMI rebounds to 55.4 from two-year low
  • New orders and output expand at faster rate
  • Employment and buying levels increase
  • Input cost rise puts slight margin pressure
2 min read

Indian manufacturing growth bounces back after December's dip, shows PMI data

HSBC India Manufacturing PMI rebounds to 55.4 in Jan 2026, showing faster growth in new orders, output, and employment despite margin pressures.

"Indian manufacturing firms saw a rebound in January, driven by increased new orders, output, and employment. - Pranjul Bhandari"

New Delhi, February 2

After losing growth traction at the end of 2025, Indian goods producers reported faster increases in new orders, output, employment and buying levels during January 2026, HSBC India Manufacturing PMI data showed Monday.

According to the PMI report, input prices rose the most in four months.

Rising from a two-year low of 55.0 in December to 55.4 in January, the seasonally adjusted HSBC India Manufacturing Purchasing Managers' Index (PMI) - a gauge of overall conditions derived from measures of new orders, output, employment, supplier delivery times and stocks of purchases - indicated a greater improvement in the health of the sector.

According to the PMI, survey participants continued to report that demand buoyancy, new business growth, and tech investment supported production. Output rose sharply, faster than in December.

Similarly, after slowing in December, new orders expanded at a faster rate. Panellists suggested that demand strength and marketing efforts drove sales to domestic and international clients higher.

Pranjul Bhandari, Chief India Economist at HSBC, said: "Indian manufacturing firms saw a rebound in January, driven by increased new orders, output, and employment."

"Input costs rose moderately, while the pace of growth in factory-gate prices eased, resulting in slight margin pressure for manufacturers. Despite faster growth in new orders, business confidence remains muted, and expectations for future output have declined to their lowest level since July 2022," Bhandari said.

The HSBC India Manufacturing PMI is compiled by S&P Global from responses to questionnaires sent to purchasing managers in a panel of around 400 manufacturers. Survey responses are collected in the second half of each month and indicate the direction of change compared to the previous month.

- ANI

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Reader Comments

P
Priya S
Good to see the bounce back, but the "muted business confidence" and "slight margin pressure" parts are worrying. If input costs keep rising, how will small manufacturers cope? The government needs to look at easing raw material costs.
R
Rohit P
The mention of tech investment supporting production is key. This is the way forward for 'Make in India' – not just more factories, but smarter ones. Need more policy push for automation and Industry 4.0.
S
Sarah B
Interesting data. The increase in international client sales is promising for exports. However, the decline in future output expectations to a multi-year low is a red flag that shouldn't be ignored amidst the positive headlines.
V
Vikram M
A solid recovery after the December dip. The PMI above 55 is always a healthy sign. Hope the employment growth is real and not just seasonal. More power to our manufacturers! 💪
K
Karthik V
The report is a mixed bag, na? Growth is back but confidence is down. It feels like manufacturers are working hard today but are anxious about tomorrow. Need stability in policies and global demand to sustain this.

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