**India’s Manufacturing Growth Slows as Factory Prices Hit 12-Year High**
*By Mudit Dube | October 1, 2025*
India’s manufacturing sector experienced a slowdown in growth last month, recording its slowest pace in four months. This decline coincides with factory gate prices rising at the fastest rate in nearly 12 years, posing new challenges for the industry.
The HSBC India Manufacturing Purchasing Managers’ Index (PMI), compiled by S&P Global, fell to 57.7 in September from August’s stronger reading of 59.3. The PMI is a key economic indicator, with readings above 50 signaling growth in activity on a monthly basis. The recent drop suggests that the manufacturing sector is currently facing headwinds.
### Challenges in the Manufacturing Sector
Rising input costs and intense competitive pressures have contributed to the moderation in new orders and output expansion. These factors are weighing on the sector’s momentum, reflecting a cautious business environment ahead.
### Export Growth Shows Positive Signs
Despite the overall slowdown, new export orders have gained momentum compared to last month. HSBC’s Chief India Economist Pranjul Bhandari highlighted that increasing demand outside the US may be offsetting a decline in orders from the US, which has been affected by tariffs.
### Rising Business Confidence
Business confidence has climbed to a seven-month high, with firms citing recent tax relief resulting from goods and services tax (GST) rate changes. Additionally, there is optimism about favorable demand prospects in the year ahead, contributing to a more positive outlook despite current challenges.
**In summary**, while India’s manufacturing growth has slowed amid rising factory prices, stronger export demand and improving business sentiment provide some encouragement for the sector moving forward.
https://www.newsbytesapp.com/news/business/india-s-manufacturing-growth-declines-as-input-prices-hit-12-year-high/story
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