India’s industrial production soared to a 16-month high in October, recording an impressive 11.7 per cent year-on-year growth in the Index of Industrial Production (IIP).

The surge, attributed to a favourable base effect, contributes to the positive outlook for the first advance estimates of the 2023-24 gross domestic product (GDP) data, set to be released on 5 January, reported Business Standard.

In contrast, November witnessed a deviation in the downward trend of retail inflation, as the Consumer Price Index (CPI) rose to a three-month high of 5.55 per cent year-on-year.

The increase was driven partly by a seasonal spike in vegetable prices.

Earlier, the Reserve Bank of India (RBI) had adjusted its economic growth projection for financial year 2024 (FY24) upward by 50 basis points to 7 per cent, anticipating a 6.5 per cent GDP expansion in the December quarter.

The recent IIP figures align with this optimistic outlook.

While the rebound in industrial production indicates sustained economic momentum, experts caution against signs of a potential slowdown.

Factors such as the RBI’s consumer confidence survey signalling weakened future expectations and measures to control risky lending may impact credit growth and domestic demand.