India's industrial production growth picked up to 2 per cent year on year in September, from a revised reading of 0.4 per cent in August -- driven by an uptick in export and domestic orders, government data showed on Tuesday.
Analysts polled by Reuters had expected an annual output growth of 3.5 per cent for the month.
The manufacturing sector, which constitutes about 76 per cent of industrial production, grew at 0.6 per cent from a year earlier, the federal statistics ministry said.
Capital goods production, a barometer for investments in the economy, contracted by 6.8 per cent in September from a year earlier.
Industrial activity received a boost from a surge in infrastructure output, which includes coal, electricity, cement, crude oil and steel factories.
Output in those industries, which account for more than one-third of overall factory production, rose 8.0 per cent annually that month versus 3.7 per cent in August, data released earlier showed.
Stronger demand from India's export destinations also led to an increase in production, with exports growing 11.15 per cent annually during September.
Meanwhile, retail inflation for the month of October rose to 10.09 per cent vs 9.84 per cent in September.
This is a 4 month high with food inflation rising to 12.56% vs 11.44%.