India's manufacturing sector growth slowed to a four-month low in March as economic activities were hit due to the nationwide lockdown called to contain the COVID-19 outbreak. The manufacturing Purchasing Managers’ Index (PMI) for India declined to 51.8 in March from 54.5 in February, according to data analytics firm IHS Markit.
A figure above 50 indicates expansion, while a sub-50 print signals contraction. Slow rise in output and new business pulled down India’s manufacturing activity to the current levels. The reading signalled the slowest improvement in business conditions since November 2019. “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,” said Eliot Kerr, Economist at IHS Markit.
Falling exports due to diminishing international demand amid the coronavirus crisis has further contributed to the downfall. The decline in international sales was the fastest since September 2013 amid widespread lockdowns due to the COVID-19 pandemic. The future also looks bleak, as per the report. "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," Kerr said.
Indian manufacturers were weighed down by supply-side disruption due to the lockdown in China following the coronavirus outbreak.
