India’s industrial output posts double-digit growth

Chief Regulatory Officer at CSE Renuke Wijayawardhane presenting the listing certificate to Executive Chairperson at Renuka Hotels Shibani Thambiayah

NEW DELHI, April 12, 2010 (AFP) – India posted double-digit industrial growth for a sixth straight month in February, data showed Monday, adding to pressure on the central bank to further hike interest rates to tame inflation. Output by factories, mines and utilities grew 15.1 percent year-on-year in February, according to the government figures, lifted by fiscal stimulus, cheap borrowing costs, resurgent consumer consumption and growing export demand.

The rise in the Index of Industrial Production was below the 16.7 percent logged in January and slightly weaker than analysts’ expectations but economists said it was a healthy performance.

The numbers will “likely reassure policymakers that they can remove stimulus without disrupting the economy’s growth,” said economist Nikhilesh Bhattacharyya at Moody’s Economy.com.

The focus of India’s central bank has switched from nurturing a recovery in Asia’s third-largest economy to worrying about prices, with inflation expected to breach 10 percent in official figures due later this week.

The interest rate cycle is turning in Asia as the region’s economies recover from the deep global recession with consumer demand and manufacturing output rebounding.

India’s