Manufacturers' buying levels rose for the second successive month, albeit at a weaker pace. Meanwhile, input stocks increased, whereas holdings of finished goods declined for the eighth straight month. Finally, backlogs of work were accumulated amid reports of delayed payments from clients.

Commenting on the Indian Manufacturing PMI survey data, Pollyanna De Lima, Economist at Markit and author of the report, said: "The Indian manufacturing economy edged further in the right direction during February, eking out modest gains in new orders and output.

However, these positive developments failed to feed through to the labour market and staffing numbers were left unchanged. Although businesses saw a stronger rise in new work, data implied that this was partly driven by price reductions.

"Goods producers continue to benefit from lower crude oil prices in global markets, which put a brake on inflationary pressures. In light of these numbers, the RBI has scope to loosen monetary policy to spur the economy."
END