India's manufacturing activity picks up pace in February

With the expansion of new orders, India's manufacturing activity picked up pace in February after decelerating to a four-month low in the previous month.

The IHS Markit India Manufacturing Purchasing Managers Index (PMI) expanded at a stronger pace of 54.9 points in February from 54 points in January, indicating a steady revival in demand in the Covid-hit economy.

The 50-point mark separates growth from contraction in PMI parlance.

"Output and new orders expanded at stronger rates, while buying activity continued. At the same time, sustained increases in backlogs could lead to higher employment levels in the months ahead should capacity pressures continue," IHS Markit economist Shreeya Patel said.

"For now, India's manufacturing sector has weathered the storm of the Omicron variant, undoubtedly supported by the relatively high inoculation rate. Moreover, demand conditions showed notable signs of resilience and price pressures somewhat receded," Patel added.

Employment fell in February but at the softest pace in past three months.

The data comes close on the heels of India's economic growth numbers of the October-December period that showed growth was dragged to lower than the previous quarter due to bleak manufacturing and constructions activities. These two sectors are responsible for the bulk of job creation in the country.

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