Manufacturing sector hits record low
Economy

Manufacturing sector hits record low

Pennews

The country's manufacturing sector activity witnessed unprecedented contraction in April amid national lockdown restrictions, following which new business orders collapsed at a record pace and firms sharply reduced their staff numbers, a monthly survey said on Monday.

The headline seasonally adjusted IHS Markit India Manufacturing Purchasing Managers' Index (PMI) fell to 27.4 in April, from 51.8 in March, reflecting the sharpest deterioration in business conditions across the sector since data collection began over 15 years ago.

The index slipped into contraction mode, after remaining in the growth territory for 32 consecutive months.

In PMI parlance, a print above 50 means expansion, while a score below that denotes contraction.

Amid widespread business closures, demand conditions were severely hampered in April. New orders fell for the first time in two-and-a-half years and at the sharpest rate in the survey's history, far outpacing that seen during the global financial crisis, the survey said.

'After making it through March relatively unscathed, the Indian manufacturing sector felt the full force of the coronavirus pandemic in April,' said Mr. Eliot Kerr, Economist at IHS Markit.

Panellists attributed lower production to temporary factory closures that were triggered by restrictive measures to limit the spread of COVID-19.

Export orders also witnessed a sharp decline. Following the first reduction since October 2017 during March, foreign sales fell at a quicker rate in April. 'In fact, the rate of decline accelerated to the fastest since the series began over 15 years ago,' the survey said.

On the employment front, deteriorating demand conditions saw manufacturers drastically cut back staff numbers in April. The reduction in employment was the quickest in the survey's history.

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