February data indicated that Indian manufacturing production continued to increase, as a rebound in export demand contributed to a stronger expansion of total new orders.

There was evidence of an intensification of inflationary pressures, with input costs rising at the quickest pace since August 2014 and output charge inflation climbing to a 40-month peak. Greater output needs encouraged some firms to step up buying levels, but production requirements were insufficient to generate job creation.

At 50.7 in February, up from 50.4, the seasonally adjusted Nikkei India Manufacturing Purchasing Managers' Index (PMI) - a composite indicator designed to provide a single-figure snapshot of the performance of the manufacturing economy - was above the neutral 50.0 value for the second month running and indicated that the health of the sector improved to a greater extent than in January.

That said, the latest reading was much weaker than the long-run series average (54.2), largely reflecting below-trend rates of growth for output and new business.

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