How Despite a Crumbling Geopolitical Landscape, India Still Stands Tall?
India doing better than the global giants in manufacturing?
Today, I came across the Economic Survey 2024-25 (shoutout to a friend for recommending it). I wanted to get a better understanding of the industry I’ve been eyeing, but realized how studying this is going to be overwhelming—this isn’t just an industry; it’s an entire ecosystem with multiple sectors intertwined. So, I’m going all in—starting broad with a sectoral analysis before zeroing in on a specific industry.
A Manufacturing Slowdown Happening - Fueled by Geopolitics
A quick look at global manufacturing trends, and it’s clear -
Ukraine-Russia, and Hamas-Israil wars, Electoral buzz in the US, India & Indonesia, etc. etc. Supply chains are stretched thin, demand is fluctuating, and economies are walking a tightrope.
From trade wars to energy crises, the geopolitical game has been anything but predictable.
Germany, Europe’s manufacturing giant, shrank for two straight years. High energy costs hurt competitiveness, and the economy slowed down.
China? The big post-pandemic rebound never really happened. Weak domestic demand led to deflation, and now China is offloading its surplus goods into global markets at dirt-cheap prices.
(Since China+1 is getting real!)The U.S. dollar’s strength and Fed rate hikes? A nightmare for emerging markets like us, making borrowing way more expensive. (Gold is the only hedge left)
Industrial output across major economies took a hit, with sluggish global demand making things worse. Exports were shaky, supply chains shifted, and companies had to revise their strategies.
Yet, India Isn’t Sinking—It’s lowkey smart
Despite the global turbulence, India isn’t drowning. We’re navigating the chaos somehow.
Yes, India’s manufacturing sector saw a slowdown, especially in Q2, thanks to weaker exports, monsoon-related disruptions, and festival season fluctuations. Some industries—like steel, oil, and cement—struggled with price pressures, but others stayed strong, such as pharmaceuticals, electrical equipment, and automobiles, which benefited from domestic demand and government incentives. More importantly, India still outperformed the global average.
We have a pretty good PMI!
The HSBC India Composite PMI - The Purchasing Managers’ Index - increased to 60.6 in February 2025 from 57.7 in the previous month, flash data showed. This marked the highest figure since August 2024 and significantly surpassed its long-term average of 54.1. While other economies, including the US, experienced contraction, India’s PMI remained in expansion mode, highlighting the country’s resilience.
December 2024’s PMI also stayed above the growth threshold, reinforcing the sustained strength of India’s private sector. While yes service sector reigned, Manufacturing maintained positive momentum despite a slight slowdown.
New business orders surged, with domestic demand holding strong and international orders climbing to a four-month high. Foreign sales even saw the fastest growth in seven months, led by goods producers, showcasing India's competitiveness in global markets.
Companies leveraged advertising, strategic market positioning, and efficient supply chain management to secure fresh business and sustain operations. Additionally, inflationary pressures remained moderate, with input price inflation hitting a four-month low, providing further support for continued growth.
PMI in simple terms:
PMI is like the speedometer of manufacturing in a country.
Where does India stand? Better than many. While global manufacturing struggles, India's PMI remains above 50, signaling resilience. Compared to nations like Germany and China, where industrial activity has shrunk, India’s position is far stronger, driven by strong domestic demand and smart market strategies.
So basically if PMI is:
-Above 50? The sector is expanding, factories are producing more, orders are flowing, and jobs are being created.
-Below 50? The sector is contracting, business is slow, factories are cutting back, and companies might be reducing costs (and jobs).
Why are we safer?
Ofc India isn’t immune to global shocks, but our economy is proving to be incredibly adaptable. We aren’t in the clear yet, but we’re holding our own. Our PMI performance compared to the rest of the world signals a few key takeaways:
Strong domestic demand is shielding us from global instability.
Indian businesses are playing it smart - leveraging marketing, innovation, and strategic expansion.
Government infrastructure and capital investments are fueling industrial growth.
For ease, we’ll pick the top three companies within a single industry. But sector first, then the industry, and finally, the leading companies driving India’s manufacturing landscape.
Have a cute day ahead <3