On Monday, data put forward by ABN AMRO revealed that there has been an expansion for the first time in six months in Indian manufacturing, which has come as another indication of economic recovery.

It was confirmed by the ABN AMRO Bank purchasing managers' index (PMI) manufacturing touched a high of 53.3 in April compared to March's 49.5. The reason behind the boost in manufacturing index was mainly due to a hike in new orders.

ABN AMRO India senior economist Gaurav Kapur reported, "The April PMI gives a very clear indication that business conditions in the manufacturing sector have improved significantly after a period of sharp contraction and gradual stabilization."

The data showed that an improvement in domestic demand was the prime factor in the return of the growth.

The data also confirms that during the month of April, the production ramped to cater to a pick-up demand and to build inventories. It further says that the output index printed at 55.7 for April compared to 49.3 in March, as new incoming business expanded during the month.

"New orders index printed at 54.9 as against 49.5 in March. This is critical as it suggests that domestic demand conditions are now strong and supportive for growth in the sector," said the data.