NEW DELHI - India's industrial output rose a bigger than expected 5.2% in January compared with the same month last year as strong domestic urban demand boosted electricity generation and manufacturing, despite weakening exports.
Analysts in a Reuters poll had predicted an increase of 5% in industrial output for the month. The rise followed upwardly revised annual growth of 4.7% in December, according to the Ministry of Statistics data.
Some economists expect industrial output growth to remain strong following a recovery in rural demand as reflected in rising sales of autos including motor-bikes and scooters.
India's industrial output, comprising production by factories, electricity generation and mining, has been impacted by slowing global demand and rising interest rates in recent months.
Manufacturing, which accounts for about 15% of the Indian economy, has also been hit by a fall in exports but rose 3.7% year-on-year overall in January.
India's merchandise exports in January fell 6.6% year-on-year to $32.91 billion.
The Reserve Bank of India has raised its benchmark interest rate by 250 basis points since last May to contain inflation, pushing up borrowing costs for consumers and businesses.
Capital goods production, a proxy for factory activity, rose 11% year on year, accelerating from a 7.6% rise the previous month, while consumer durables' production contracted 7.5% year-on-year after a 10.4% contraction the previous month, the data showed, reflecting a continuing slowdown in consumer demand.
Production of textile garments, tobacco products, basic metals and chemicals contracted between 7% and 30% in January from a year earlier, data showed, while mining output rose 8.8%, slower than 9.8% growth the previous month.
India's total passenger vehicle sales grew 11% in February from a year earlier, separate data released by the Society of Indian Automobile Manufacturers (SIAM) on Friday showed.
India's economy, the world's fifth-largest, grew 4.4% year-on-year in the fourth quarter, down from 6.3% the previous quarter, and the government expects the economy to post annual growth of 7% for fiscal 2022/23 ending this month.
(Reporting by Manoj Kumar and Shivangi Acharya; editing by John Stonestreet and Hugh Lawson)