A separate report revealed that industrial output climbed 3.4% in April, compared to an estimated 1.9% rise.

Modi also promised to bolster the economy through increased investment and clearing the red tape for businesses. The better outlook for the domestic economy would also bolster smaller companies. Investors can gain exposure to India’s small-cap stocks through the Market Vectors India Small-Cap Index ETF (NYSEArca: SCIF), EGShares India Small Cap ETF (NYSEArca: SCIN) or iShares MSCI India Small-Cap ETF (NYSEArca: SMIN).

There is some possible improvement in the investment cycle going ahead on confidence building,” Anjali Verma, an economist at PhillipCapital, said in the Times of India article. “This kind of data will encourage the government to take steps to boost growth.”

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Max Chen contributed to this article.