According to a survey released on Monday, India’s manufacturing growth picked up in October after three months of decline, driven by improved demand, job creation, and a more positive business outlook.

The HSBC final India Manufacturing Purchasing Managers’ Index, compiled by S&P Global, increased to 57.5 in October from an eight-month low of 56.5 in September, surpassing a preliminary estimate of 57.4.

Pranjul Bhandari, chief India economist at HSBC, commented that the manufacturing PMI’s significant rise in October indicates ongoing improvements in the economy’s operating conditions.

The growth in new orders and international sales highlights strong demand in India’s manufacturing sector. Additionally, the output and new orders sub-indexes reached three-month highs due to a marked increase in demand.

International demand for Indian goods improved from a year-and-a-half low in September, with orders coming from Asia, Europe, Latin America, and the U.S.

This strong demand has positively influenced the business outlook for the upcoming year.

Bhandari noted that business confidence is high due to expectations of continued strong consumer demand, new product launches, and pending sales approvals.

Companies increased hiring for the eighth consecutive month to meet the rising demand, adding more workers than in September.

This increase in employment could relieve the government, which has struggled to create enough well-paying jobs for new entrants into the workforce. However, according to a Reuters poll conducted last week, economists warned that job creation may remain subdued over the next 12 months.

India’s inflation rose to a nine-month high of 5.49% in September, mainly due to higher food prices, approaching the Reserve Bank of India’s (RBI) target range of 2-6%.

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