New Delhi: India’s Industrial Production (IIP) figure, which reflects the performance of 3 core industries- manufacturing, mining and electricity, on Thursday showed a slow growth at 7.8 percent in March, 2011, in comparison to 10.5 per cent in the same month in 2010.

Manufacturing output, which constitutes about 80 percent of the industrial production, rose an annual 7.9 percent, the Central Statistics Organisation (CSO) said in a statement.

Industrial output grew 7.8 percent in the 2010/11 fiscal year that ended in March, slower than 10.5 percent clocked in the previous fiscal year.

The HSBC Markit Purchasing Managers' Index, an indicator of manufacturing expansion, edged up to 58.0 in April from 57.9 in March.

While both input and output price indexes fell from the highs seen in March, they remained way above the 50 mark as soaring fuel and raw material prices drove up costs and fed into output prices, a clear indication that high inflation was here to stay.

The Reserve Bank of India ( RBI )), which stepped up its fight against inflation with a bigger-than-expected 50 basis point rise in interest rates on May 3, has vowed to battle price pressures even at the cost of some economic growth.

Analysts say the RBI's aggressive 50 bps hike and the likelihood of more increases in coming months will hamper manufacturing growth by raising the cost of borrowing funds and slowing robust domestic demand.

Food price index rose 8.53 per cent and the fuel price index climbed 13.53 per cent in the year to April 23, government data showed.

Country's exports, which in March rose 43.9 per cent to $29.1 billion, surged to a record high of $245.9 billion in the 2010/11 fiscal year.

Country's infrastructure sector output grew 7.4 per cent in March from a year earlier, faster than the annual growth of 6.8 per cent in February, data showed last week. The infrastructure sector accounts for just over a quarter of country's industrial output.

Agencies