The growth recorded in the Indian manufacturing sector slowed to an eight-month low in September. The headline Purchasing Managers Index (PMI) figure released by HSBC on Tuesday stood at 56.5, down from 57.5 in August.

It said the slowdown in the sector was attributed to softer expansion in factory production and sales, which were at their weakest since the beginning of the year.

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During September, the net employment and purchase quantities rose during the month, and business confidence was broadly aligned with its long-run average.

On the price front, there were moderate increases in input costs and selling charges.

“September data revealed a mild setback in manufacturing growth across India. For the third straight month, rates of expansion in factory production and sales receded, both of which were at their weakest since the turn of the year. Notably, international orders rose at the slowest pace in a year and a half.”

Further, the survey highlighted positive demand trends, successful advertising, and favourable client interest as the main drivers of sales growth in the qualitative part of the survey.

A factor constraining total sales growth was a softer increase in new export orders, with the rate of expansion being moderate and the least pronounced in a year and a half, it added.

The survey noted that growth slowed in the consumer and capital goods segments, while it steadied among intermediate goods makers. Cost pressures increased in September, with panellists citing higher chemical, packaging, plastic, and metal prices.

As a result of rising purchasing prices, as well as greater labour costs and favourable demand conditions, Indian manufacturers raised their charges in September, it said.

The survey further talked on the job creation front. It said that hiring growth slowed in September.

Those that recruited additional staff, cited projects in the pipeline. The combination of job creation and slower increases in new business allowed companies to keep pace with their workloads.