India’s manufacturing sector activity hit the highest level in eight months in July, driven by a significant rise in business orders, a monthly survey said.

The seasonally adjusted S&P Global India Manufacturing Purchasing Managers’ Index rose to 56.4 in July from 53.9 in June, reflecting the strongest improvement in the health of the sector in eight months.

The July PMI data pointed to an improvement in overall operating conditions for the 13th straight month. In PMI parlance, a print above 50 means expansion while a score below 50 denotes contraction. “The Indian manufacturing industry recorded a welcome combination of faster economic growth and softening inflation during July,” Pollyanna De Lima, economics associate director at S&P Global Market Intelligence, said.

Output expanded at the fastest pace since last November, a trend that was matched by the more forward-looking indicator of new orders. “Although the upturn in demand gained strength, there were clear signs that capacity pressures remained mild as backlogs rose only marginally and job creation remained subdued,” Lima added. The aggregate new order intakes rose substantially in July, recovering the growth momentum lost in June.

The readings are based on a monthly survey of businesses that are mainly into manufacturing activities.

“The latest increase was in fact the most pronounced since last November, with quicker expansions recorded in all three broad areas of the manufacturing industry,” according to the survey. Inspite of the solid performance of the manufacturing sector, overall job creation remained subdued.