In yet another indicator of how badly India's economy is faring, the growth of the country's domestic factory orders and production slowed to a 10-month low in May as most states restricted businesses to contain the spread of the deadly second wave of the coronavirus.
The IHS Markit India Manufacturing Purchasing Managers' Index (PMI) slipped to 50.8 in May from 55.5 in April. In May 2020, manufacturing activity had contracted, with the PMI falling to 30.8. A reading above 50 denotes economic expansion, reported Bloomberg.
While the year began on stronger footing, the manufacturing sector has continued to lose growth momentum. While production, new orders and input buying have continued to expand, but growth has stagnated.
Pollyanna De Lima, Economics Associate Director at IHS Markit, said the Indian manufacturing sector is showing increasing signs of strain as the COVID-19 crisis intensifies. She pointed out that key gauges of current sales, production and input buying weakened noticeably in May and pointed to the slowest rates of increase in 10 months.
"Amid a lack of new work, goods producers reduced headcounts again, with the rate of job shedding quickening in May," Lima said.
Auto Sales Dips
In the backdrop of this crisis, auto manufacturers have also posted muted wholesales of vehicles last month. Maruti Suzuki said it sold 32,903 passenger vehicles (PVs) in the domestic market, compared with 1.35 lakh in April 2021, and 13,702 in May 2020, as reported by The Hindu.
Hyundai Motor India's domestic sales stood at 25,001 last month. It dispatched 6,883 in May 2020, and 49,002 units in April 2021.