New Delhi: Led by a recovery in manufacturing output, industrial production grew by 5.9 percent in November, 2011, after witnessing a contraction in the previous month, a development that may reverse the negative sentiment amid an economic slowdown.

Factory output, as measured by the Index of Industrial Production (IIP), grew by 6.4 percent in November, 2010, as per data released by the government here on Thursday.

Meanwhile, the IIP figure for October, 2011, has been revised. The latest data indicates a 4.74 percent contraction in industrial output during the month, as against the provisional estimate of a 5.1 percent decline in production.

Output of the manufacturing sector, which constitutes over 75 percent of the index, went up by 6.6 percent in November, compared to a growth of 6.5 percent in the same month of 2010.

Power generation grew by robust 14.6 percent in November, 2011, compared to 4.6 percent in the same month of 2010.

Production of consumer goods also witnessed a 13.1 percent upswing during the month under review, as against growth of a mere 0.7 percent in the corresponding month of 2010.

Furthermore, consumer durables production increased by 11.2 percent, compared to a growth of 7.2 percent in November, 2010.

During the month under review, output of consumer non-durables also went up by 14.8 percent. The segment had declined by 4.4 percent in November, 2010.

However, mining output declined by 4.4 percent in November this fiscal, as against a growth of 6.9 percent in the corresponding month a year ago.

Production of capital goods also fell by 4.6 percent in the month under review. The segment had grown by 25.7 percent in the corresponding month of 2010.  Meanwhile, basic goods production witnessed 6.3 percent growth in November, 2011, as against growth of 5.7 percent in the same month of 2010.

Production of intermediate goods also rose marginally by 0.2 percent during the month, compared to growth of 4.3 percent in the year-ago period.

The resurgent industrial production numbers are likely to boost the sentiment in the economy and may also help the RBI go for rate cuts in the near future.

India's economy grew by 6.9 percent in July-September, 2011, the slowest rate of expansion in nine quarters.

India Inc had attributed the slowdown to rising interest rates, which have led to an increase in the cost of borrowing, thus hindering fresh investment.

The Reserve Bank has hiked interest rates 13 times since March, 2010, to tame inflation. Headline inflation has been above the 9 per cent-mark since December last year.

Improved industrial growth can end of slowdown: Montek

Encouraged by around 6 percent industrial growth in November, the Planning Commission on Thursday exuded confidence that it would help improve the business sentiment and hopefully indicates an end to the slowdown.

"Clearly, the industrial growth of almost 6 percent is a good change... I think it hopefully indicates that the slowdown in industry will basically come to an end during the third quarter (October to December) of the financial year," Planning Commission Deputy Chairman Montek Singh Ahluwalia said.

Led by a recovery in manufacturing output, industrial production grew by 5.9 percent in November, 2011, after witnessing a contraction of 4.74 percent in the previous month.

Asked whether it would reverse the negative sentiment, Ahluwalia said, "I don't believe any one indicator affects sentiments, but there is no doubt that this is a positive move... Taken with other developments, (it) should lead to improvement in sentiments over the next several weeks."

The Plan panel deputy chief, however, said improvement in the Index of Industrial Production (IIP) in November will not change the whole picture for 2011-12.

"The likely GDP growth this year will be around 7 percent and not 8 percent. It could be little bit more. It depends on what the last quarter (January-March) is like," Ahluwalia added.

The Indian economy grew by 8.5 percent in 2010-11. However, in the first half of the current fiscal, the economic growth was 7.3 percent, down from 8.6 percent in the corresponding period a year ago. The GDP growth rate was 6.9 percent in the quarter ending September, 2011.

Prime Minister Manmohan Singh had earlier said economic growth could slip to 7 percent in the current fiscal.

Meanwhile, buoyed by a sharp rebound in factory output in November, PMEAC Chairman C Rangarajan exuded confidence that industrial production will pick up in the remaining months of the fiscal.

"I think the industrial production will pick up in the second half of the year... The indications as thrown up by the data for November may continue into the rest of the months of the current fiscal," the Prime Minister's Economic Advisory Council (PMEAC) chief said.

(Agencies)