* Nov. Industrial output growth seen at 2.2 pct vs 1.3 pct contraction year ago
* Annual retail inflation seen at 5.4 pct in Dec. vs 9.9 pct year ago
* IIP and CPI data due on Monday, Jan 12 at 1200 GMT (Rephrases lead paragraph)
By Manoj Kumar
NEW DELHI, Jan 12 (Reuters) - Held back by weak demand at home and abroad, Indian industrial output probably made a tepid recovery late last year, underscoring the challenges faced in 2015 by Prime Minister Narendra Modi as he seeks to woo global investors this week.
To accelerate the recovery in Asia's third largest economy from its longest slowdown since the 1980s, Modi has pushed through a raft of economic reforms, mostly by executive orders.
But global headwinds, lukewarm domestic demand and unused industrial capacity mean capital investment has not picked up and the economy remains way below potential.
Retail inflation - still a major issue for Asia's third largest economy though it fell to an all time low in November - probably rose sharply in December fuelled by higher food prices.
Analysts say there still remains a good chance that the Reserve Bank of India will cut interest rates, possibly after the government presents its annual budget in late February.
The first economic readings to be published in 2015 will be out on Monday, when the government releases industrial output data for November and the consumer price index for December.
According to forecasts from a Reuters poll of analysts industrial output was likely to show a 2.2 percent rise year-on-year in November, bouncing back from a 4.2 percent contraction in October, when Indian factories suffered their worst showing in three years.
Modi, hosting captains of industry in his home state Gujarat, said in a speech on Sunday that India's economic outlook was robust. India was the only large economy expected to grow more quickly this year than last, he said.
By-passing parliament to kick-start hundreds of billions of dollars in stalled projects, Modi's government issued an executive order on Dec. 29 to ease land-acquisition rules in sectors like power and housing.
His government also drew some relief last week after some 300,000 coal workers ended a short strike against a move to open up industry for private firms.
PRICES
Consumer price inflation data, also due on Monday, was forecast to accelerate to 5.4 percent in December, after a record low of 4.4 percent in the previous month.
Since it remains within the central bank's target of achieving 6 percent retail inflation by January 2016, analysts expect the RBI could soon cut interest rates following a hefty reduction in the oil import bill.