BENGALURU, Aug 1 Reuters India39;s manufacturing activity expanded at a solid pace in July thanks to continued robust demand, according to a survey that also showed cost pressures were high as prices charged to clients rose at the steepest rate in over a decade.

Manufacturing accounts for less than onefifth of the country39;s economy but in a recent budget the government announced spending plans aimed at boosting the sector, supporting growth in Asia39;s thirdlargest economy.

The HSBC final India Manufacturing Purchasing Managers39; Index PMI, compiled by SP Global, came in at 58.1 last month, little changed from June39;s 58.3 reading but slightly lower than the preliminary estimate of 58.5.

It has been above the 50mark separating growth from contraction since July 2021 the longest expansionary streak in 11 years.

India39;s headline manufacturing PMI showed a marginal slowdown in the pace of expansion in July, but with most components remaining at robust levels, the small drop is no cause for concern, noted Pranjul Bhandari, chief India economist at HSBC.

Buoyant domestic demand was underscored by healthy growth in both new orders and output, although the subindexes fell slightly from June.

On the other hand, exports rose at the secondfastest pace in 13 years thanks to strengthening international demand from regions such as Asia, Europe, North America and the Middle East.

The outlook for the coming 12 months remained optimistic with firms still taking on…