The manufacturing sector is expected to witness subdued investments at least for a few more months, a new survey has found.

According to FICCI Quarterly Manufacturing Survey, only 25 per cent respondents have plans for new investments in the next six months.

Investment remains subdued in the manufacturing sector. For the first quarter of 2015-16, about 75 per cent respondents against 73 per cent in the fourth quarter of 2014-15 and 74 per cent in the third quarter said they don’t have any plans for capacity additions for the next six months.

“Delay in regulatory clearances, poor demand conditions and high cost of borrowing are affecting the expansion plans,” the survey noted. The study covered 386 manufacturing units across 13 sectors — textiles, capital goods, metals, chemicals, cement & ceramics, electronics, auto, leather & footwear, machine tools, food, tyre, paper and textiles machinery.

Indicating little optimism, the proportion of respondents with higher production vis-à-vis last year has fallen to 45 per cent in the first quarter of 2015-16 from 52 per cent in the fourth quarter of 2014-15.

The outlook on exports seems to be weakening and manufacturing growth is likely to be pulled down, the survey added.

In terms of order books, 44 per cent respondents have reported higher order books for April-June 2015-16 against 42 per cent in the previous quarter (January-March 2014-15). Inventory levels indicate some improvement with 29 per cent respondents reported carrying more than their average inventory levels compared with 33 per cent respondents in the fourth quarter.

Hiring outlook seems pessimistic with 79 per cent respondents not likely to hire additional workforce in the next three months, it said.

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