Registering a sharp recovery in December, India's infrastructure output has raised prospects of resurgence in industrial production growth. The six core industries, which include crude oil, petroleum refining, coal, electricity, cement and finished steel, have a combined strength of in the index of industrial production (IIP).

The output increased, faster and higher than an upwardly revised growth of 3% in the previous month, to 6.6% from a year earlier in December 2010.

The six core sectors of account for 26.7% of India's industrial production output, and this improved performance in infrastructure was driven by strong crude oil and petroleum refinery sectors. This further ignited expectations of a better factory output as infrastructure growth rose to 5.3% compared with 4.7% a year ago, in just nine months.

The infrastructure sector growth has heralded an advance indicator of the industrial activity.

Despite these indications, economists, however, are sceptic of taking too much in the infrastructure sector growth index owing to the apparent conflict in numbers and high variations in the recent months. Major concerns are that growth may be moderating, since the IIP had dropped to an 18-month low of 2.7% in November.