Industrial output fell 0.6 per cent in December from a year earlier, after contracting a revised 1.3 per cent in November, data from the statistics ministry showed on Wednesday.However it was better than the forecast of 1 percent.
The manufacturing sector, which constitutes about 76 per cent of industrial production, contracted 1.6 per cent from a year earlier.
Capital goods production, a barometer for investments in the economy, fell an annual 3.0 per cent in December, compared with a 0.3 per cent provisional growth in the previous month.
The government last week cut its estimate of annual economic growth for the current fiscal year ending in March to 4.9 per cent from 5 per cent because of a contraction in the manufacturing and mining sectors.
The weak numbers does not do good for the markets, which may react in a negative way even though the inflation data came out better.