Manufacturing activity growth in India was sluggish in August 2021 due to the Coronavirus pandemic and rising input costs. IHS Markit’s Purchasing Managers’ Index (PMI) fell from 55.3 in July 2021 to 52.3 in August 2021. Hiring activity also ground to a halt as business confidence was dampened due to the impact of Covid.
“Industrial production growth in India was held back in August by the pandemic and rising input costs. A softer uptick in sales caused companies to halt recruitment efforts, with business confidence dampened by concerns about the damaging impact of COVID-19 on demand and companies “finance,” the study said in its report.
“Employment levels faltered in August as companies reportedly had enough staff to meet current requirements and confidence remained weak. While production was set to pick up in the coming year, overall optimism waned from July,” the study said. on the job scenario.
It further noted that while order books continued to expand and companies maintained optimistic growth forecasts, inventory building efforts continued and additional materials were purchased. On the price front, a softer but still sharp increase in input costs fueled a faster increase in expenses.
“Production production rose for the second straight month in August amid reports of improved sales and demand. However, growth was held back by the pandemic and heightened price pressures,” noted the IHS study.
Overall, the survey found that the growth rate was modest and below the long-term average.
“New orders also rose for the second month in a row, and at a slower pace. Some companies suggested that favorable market conditions and fertile advertising stimulated demand for their goods. Others noted that sales fell due to the pandemic,” he said. the report.
The August data also pointed to successive increases in new export orders, but here again growth lost momentum. The pace of expansion was only marginal. Indian manufacturers again signaled a monthly rise in costs, pushing current inflation to 13 months.