Why in News? 

• India’s Manufacturing PMI dropped to a three-month low of 57.6 in May 2025 due to border tensions, inflation, and increased competition. 

About PMI 

• PMI is an important indicator of business activity in the manufacturing and services sectors. 
• It is based on monthly surveys of purchasing managers about changes in key business areas compared to the previous month. 
• PMI is calculated separately for manufacturing and services, and then a composite index is prepared. 
• It shows whether business activity is expanding (above 50), contracting (below 50), or stable (50). 
• The Purchasing Managers' Index (PMI) for India, now published by S&P Global after merging with IHS Markit, assesses the manufacturing sector's performance based on a survey of around 500 companies.