The Nikkei India Manufacturing Purchasing Managers' Index (PMI) rose slightly to 52.2 points in the month of September, up from 51.7 in August. This was on account of improved sales to both domestic and international clients apart from gains in orders, output, and employment, the monthly survey said.
It is the 14th consecutive month that the manufacturing PMI has remained over 50 points. In measuring PMI, an above 50 measurement means expansion and below it signifies contraction.
"Growth of India's manufacturing sector picked up during the latest survey period, reflective of strengthening demand especially from foreign clients, which helped to drive export growth up to its highest level since the turn of the year," the report said.
The input costs have intensified, rising the most since June. The prices for steel and fuel were aggravated by the stronger US dollar and the global shortage in supply. Rising price will continue weighing on the sentiment, the report said, but firms remain confident over the increase in output.
Additionally, on account of new orders received, there has been an increase in the workforce hiring. "Staffing levels rose for a sixth successive month and at the fastest rate since June," the survey said.
In the April June quarter, India's economy grew at a two-year high of 8.2 percent, backed by a good performance from the manufacturing and agricultural sector.