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NEW DELHI: India's industrial output in July leapt by 13.8 per cent, data showed Friday -- far outpacing market forecasts -- as consumer demand in Asia's third-largest economy remained robust.
The official year-on-year government figures reflected India's strong rebound from the global financial crisis and marked a sharp acceleration from June's revised 5.8 per cent output rise.
The healthy performance surprised analysts who had forecast a rise of around eight per cent and may increase pressure on the central bank to hike interest rates for a fifth time this year in a bid to tame stubbornly high inflation.
Manufacturing, which accounts for 80 per cent of the industrial output index, rocketed 15 per cent in July from a year earlier and included a massive 63 per cent surge in capital goods output.
Mining expanded by 9.7 per cent from a year earlier while electricity output rose 3.7 per cent.
The strong monthly output figures came despite the most aggressive monetary tightening in the Asia-Pacific region aimed at checking inflation running at nearly 10 percent.
The Congress-led government has been under relentless pressure from the opposition over its "failure" to protect India's poorest from surging prices.
The central bank is walking a tightrope as it seeks to balance the need to curb inflation with an uncertain global economy.
The output figures came after data late last month showed India's economy grew 8.8 per cent in the fiscal first quarter, its best performance since 2007, as the country returned to boom levels last seen before the financial crisis.
India's finance minister Pranab Mukherjee forecasts the economy will expand by at least 8.5 per cent in the fiscal year to March 2011 and expects it to return to growth levels of nine percent next year. - AFP/fa
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