India’s manufacturing sector growth slowed in March due to a softer rise in output and new business amid the global coronavirus or COVID-19 outbreak, survey results from IHS Markit showed on Wednesday.
The headline IHS Markit manufacturing Purchasing Managers’ Index, or PMI, decreased to 51.8 in March from 54.5 in February.
The reading signaled the slowest expansion since November 2019. Any reading above 50 indicates expansion in the sector.
Output and new orders rose at a slower pace in March. New export business declined at the fastest pace since 2013 amid widespread lockdowns.
The number of staffs increased in March, but the rate of expansion remained unchanged from February’s recent low. Suppliers’ delivery time lengthened for the first time in five months.
On the price front, cost burdens rose at the end of the first quarter, extending the current sequence of inflation to five months. Firms raised their output charges in line with the rise in input costs. Both input costs and output charges increased in March, while the rates of inflation eased.
Sentiment towards the 12-month business outlook eased in March and the firms remained confident about the overall rise of output, but positivity hit its joint-weakest level since April 2012.
“The Indian manufacturing sector remained relatively sheltered from the negative impact of the global coronavirus outbreak in March, however, there were pockets of disruption and a clear onset of fear amongst firms,” Eliot Kerr, an economist at IHS Markit, said.
Should the trajectory of injections continue in the same vein, the Indian manufacturing sector can expect a much sharper negative impact in the coming months, similar to the scale seen in other countries, the economist added.
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