Manufacturing sector growth slumps to 25-month low in November

NEW DELHI: Manufacturing activity in India slowed to a 25-month low in November, pulled down by higher input cost inflation, a private survey showed.

The Nikkei Manufacturing Purchasing Managers' Index declined to 50.3 in November from 50.7 in October, data released on Tuesday showed. The index has fallen for the fourth consecutive month.

A reading above 50 on this survey based index denotes expansion.

The data comes a day after the central statistics office released the GDP data for the September quarter that showed a marked 9.3 per cent increase in manufacturing in the period.

"November PMI data point to tepid manufacturing growth across India, with gloomy domestic demand resulting in weakest expansion in production in 25 months," said Pollyanna De Lima, economist at Markit, the agency that compiles the index.

The manufacturing PMI and annual GDP numbers are not strictly comparable. The PMI is based on survey response and it also measures sentiment month on month as opposed to GDP that is increase from last year and actual quantitative rise in output.

The latest PMI data shows slower increases in incoming new business and output, while subdued demand growth led firms to keep workforce numbers broadly unchanged.

De Lima added that the disappointing news is accompanied by a stagnant labour market in the sector.