“For the third quarter of 2025-26, the index has touched all-time high with 91% of respondents reported either higher or same production levels as compared to 87% for Q2 FY 2025-26. This optimism is also evident in domestic demand, as 86% of respondents anticipated higher or same orders in Q3 FY 2026 compared to the previous quarter and more so after the latest GST rate cuts announced,” the FICCI Survey said.
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The existing average capacity utilization in manufacturing is close to 75% and future outlook is steady for investments and expansions in the next six months. However, the FICCI survey flagged concerns about the difficulties respondents face in expanding capacity, citing global and geopolitical factors, such as tariffs, trade restrictions, and economic uncertainty, as well as operational challenges including labour availability, raw material shortages, and regulatory hurdles.
“In exports, about 69% of respondents reported higher or same level of exports in Q2 FY 2025-26 and in Q3 2025-26 more than 70% of the respondents expect their exports to be higher or same as compared to previous year’s similar quarters,” the survey said.
Growth Expectations for Q3 FY 2025–26*
| Sector | Growth Expectation |
| Capital Goods | Moderate |
| Chemicals, Fertilizers & Pharmaceuticals | Moderate |
| Electronics & Electricals | Strong |
| Machine Tools | Moderate |
| Metal & Metal Products | Moderate |
| Miscellaneous | Strong to Moderate |
| Textiles, Apparels & Technical Textiles | Moderate |
| Auto Components | Moderate |
* Growth Expectation Scale:
- Very Strong: >20%
- Strong: 10–20%
- Moderate: 5–10%
- Low: <5%
Source: FICCI SurveyAlso read: Will Trump be the uninvited guest at Sitharaman’s Budget table?
On the hiring front, the FICCI survey reveals that 38% of the respondents are looking at hiring an additional workforce in the next three months as compared to 35% in the same quarter last year. The average interest rate paid by the manufacturers has been reported to be 8.9%. A little over 87% of respondents reported sufficient availability of funds from banks for working capital or long-term capital.