The survey was conducted among purchasing executives in over 400 companies in India.
The manufacturing in India witnessed growth in September, with Purchasing Manager Index (PMI) rising to 52.2 per cent as against 1.7 per cent in August. This is the 14th consecutive month of expansion.
The index, better known as the Nikkei India Manufacturing Purchasing Managers’ Index, is prepared by IHS Markit.
The index over 50 shows expansion while below 50 means contraction.
It is based on the survey conducted among purchasing executives in over 400 companies.
These companies are divided into eight broad categories: Basic Metals, Chemicals & Plastics, Electrical & Optical, Food & Drink, Mechanical Engineering, Textiles & Clothing, Timber & Paper and Transport.
The latest PMI is slightly below a Reuters poll median of 52.4.
"Growth of country's manufacturing sector picked up during the latest survey period, reflective of strengthening demand especially from foreign clients, which helped to drive export growth up to its highest level since the turn of the year," Paul Smith, economics director at IHS Markit," said in a release accompanying the survey.
However, optimism about future output slipped to the lowest since June 2018, the survey showed.
The survey said the ongoing US-China trade war has pushed the dollar up and hurting emerging market economies.
Even rupee fell over 13 per cent this year and is ramping up the cost of crude oil imports.
The weaker rupee and crude oil pose a serious risk to inflation.
"Rising prices continued to weigh on sentiment, with confidence dropping a little to reach a three-month low," Smith said.
Source: Media reports