NewKerala.com

India's Manufacturing Sector Booms: GVA Growth Hits 9.13%, PMI Strong

India's manufacturing sector has shown significant strengthening, with Gross Value Added growth reaching 7.72% in Q1 and accelerating to 9.13% in Q2 of FY26. The Economic Survey highlights a structural shift, as medium- and high-technology industries now contribute nearly half of the manufacturing value added. This momentum is reflected in industrial output, which expanded 7.8% in December 2025, the strongest growth in over two years, led by manufacturing at 8.1%. Forward-looking indicators like the Purchasing Managers' Index remain firmly in expansion territory, signaling sustained optimism for the sector's role in India's long-term economic ambitions.

Key Points: India Manufacturing Growth Soars: GVA Hits 9.13% in Q2 FY26

  • Robust GVA growth of 9.13% in Q2 FY26
  • High-tech industries now contribute 46.3% of manufacturing value
  • Industrial production rose 7.8% in Dec 2025, strongest in 2 years
  • Manufacturing PMI at 55.4 in Jan 2026, firmly in expansion
2 min read

India's manufacturing sector strengthens further in recent quarters with robust GVA growth

India's manufacturing GVA grows 9.13% in Q2 FY26, driven by high-tech industries and strong IIP. PMI remains robust, fueling economic ambitions.

"Reflecting these gains, India's global industrial competitiveness has improved, with the country's ranking in the Competitive Industrial Performance (CIP) index rising to 37th in 2023 from 40th in 2022 - Official Statement"

New Delhi, Feb 12

India's manufacturing performance has strengthened further in recent quarters, with GVA growth of 7.72 per cent in Q1 FY26 and 9.13 per cent in Q2, supported by a gradual shift towards higher-value production, improved industrial infrastructure, and wider adoption of technology and formalisation, an official statement said on Thursday.

The Economic Survey 2025-26 highlights that medium- and high-technology industries now contribute 46.3 per cent of India's manufacturing value added, signalling a gradual shift towards more sophisticated production structure.

"Reflecting these gains, India's global industrial competitiveness has improved, with the country's ranking in the Competitive Industrial Performance (CIP) index rising to 37th in 2023 from 40th in 2022," the statement said.

Notably, manufacturing today sits as the engine of growth for India's ambition to become a $35 trillion economy by 2047, with reforms, sectoral initiatives, and resilient supply chains.

The statement further said that the Union Budget 2026-27 has reinforced support for manufacturing through targeted measures focusing on investment incentives, innovation, infrastructure development, and industrial ecosystem strengthening.

Moreover, the industrial activity continues to gain strength, with real Industry GVA growing at 7 per cent year-on-year in the first half of FY 2025-26.

This momentum carried further into the year as industrial production rose 7.8 per cent in December 2025, the strongest expansion in over two years, after registering a high growth of 7.2 per cent (revised estimate) in November 2025.

"This expansion, also reflected in the Index of Industrial Production (IIP), is primarily driven by the manufacturing sector registering a growth of 8.1 per cent in December 2025. Within this, strong growth was recorded in computer and electronic products (34.9 per cent), motor vehicles and trailers (33.5 per cent), and other transport equipment (25.1 per cent)," said the government.

Forward-looking indicators continue to reflect optimism in India's industrial sector, with the manufacturing Purchasing Managers' Index (PMI) remaining firmly in expansion zone (well above the 50 mark) since March 2023.

In January 2026, PMI stood at 55.4, above its long-run average, indicating continued improvement in the sector's health.

- IANS

Share this article:

Reader Comments

P
Priya S
Great to see the numbers, but I hope this growth translates to better wages and working conditions on the ground, especially for MSME workers. The formalisation push must be inclusive.
R
Rohit P
Motor vehicles at 33.5% growth! 🚗 As someone in the auto components industry in Pune, I can feel this momentum. Order books are full, and there's a real sense of optimism in the industrial areas.
S
Sarah B
The PMI staying above 50 for so long is a very strong signal. Investor confidence seems to be holding up. Hoping the infrastructure development keeps pace with this industrial expansion.
V
Vikram M
Moving from 40th to 37th in the CIP index is good, but we should aim for top 20. The focus on innovation in the budget is key. We need to move beyond assembly to genuine R&D and design.
K
Kavya N
While the headline numbers are impressive, I'm curious about the regional spread of this growth. Is it concentrated in a few states, or are we seeing a more balanced development across the country?
M
Michael C
The sustained PMI and IIP data show remarkable resilience. India is becoming a crucial part of global supply chain diversification. The electronics manufacturing push is particularly strategic.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

Leave a Comment

Minimum 50 characters 0/50