The HSBC India Manufacturing PMI fell to 53.9 in March 2026 from 56.9 in February, slightly higher than preliminary estimates of 53.8. This marked the weakest improvement in business conditions in nearly four years, as factory output and new orders rose at the slowest pace since mid-2022, weighed down by cost pressures, intense competition, and heightened market uncertainty amid the Middle East conflict. Meanwhile, employment increased at the fastest rate in seven months as firms added staff, while input buying and inventories continued to expand, albeit at a slower pace. External sales also saw their strongest expansion since September 2025, supported by gains across multiple regions. On prices, input costs rose sharply to a 43-month high, but output price inflation remained modest, reflecting firms’ efforts to absorb higher expenses. Firms became more optimistic about production over the year, even as backlogs of work declined for the first time in nearly 18 months.