India's economic growth slowdown could be worse than expected, shave a 1% off Chidambaram f'cast

Business leaders and economists have called on the government to make it easier for firms to acquire land for new projects and carry out tax reforms to boost economic growth that has been stuck around 5.5 percent for the past three quarters.

Road, power and mining projects worth billions of dollars have been held up for years because of delays in getting multiple regulatory clearances.

To help revive the economy and spur investments, the Reserve Bank of India (RBI) last month cut interest rates for the first time in nine months, trimming the repo rate by 25 basis points.

But the RBI also warned that while halting the slide in economic growth was a priority it had limited room for further easing unless inflation and a high current account deficit improved by more than expected.

The slowdown has hit government revenues, leaving New Delhi scrambling for ways to cut its fiscal deficit to avert a downgrade in its sovereign credit rating to junk bond status.