Several analysts have warned that growth in India could decelerate further this year, suggesting it would be a while before recent government measures can get Asia's third largest economy moving again.

HSBC on Monday slashed its India GDP forecast for the ongoing financial year just as a separate HSBC-Markit survey revealed that business conditions in the Indian manufacturing sector deteriorated in August. The Asia-focused bank revised its India growth forecast to 4% from 5.5% and said that macroeconomic uncertainty was likely to pull down growth in the coming months.

JPMorgan cut its India GDP growth forecast to 4.1% from 5.1% and said that high interest rates among other factors could weigh on growth.

Earlier, French bank BNP Paribas slashed its India GDP forecast to 3.7% from 5.7% and said that the country's macroeconomic situation was "fast approaching crisis proportions". If met, it would mark India's lowest growth rate in 22 years.

Brokerage firm Morgan Stanley has said the country's growth could slide to between 3.5% and 4%, while Nomura estimates real GDP growth to hover between 4.2% and 5.0%.

"The outlook for India is still tainted with downside risks given the lingering macroeconomic uncertainties and the possibility that politics could get in the way of meaningful progress on structural reform," HSBC said in a research note.

"In light of this, we revise down our GDP growth forecasts to 4% for FY2014 and to 5.5% for FY2015."

A JPMorgan report noted that "things are likely to get worse".

Government spending, which maintained a blistering pace, will probably be forced to slow down in the current quarter as concerns about fiscal slippage increase," said the report.

"But the stagflationary shock from the rupee depreciation over the last three months and high interest rates are expected to be the key drag on growth and stress on unhedged corporate balance sheets."

India's factories cut production for the fourth successive month in August and the fastest rate in over four-and-a-half years.

The Markit-compiled HSBC manufacturing purchasing managers' index (PMI) fell to 48.5 in August from 50.1 in July. A reading below the neutral 50-mark points to contracting factory activity.

India is battling high inflation, falling GDP growth, a huge trade gap, a depreciating rupee and political turmoil. However, India's Prime Minister Manmohan Singh expects growth to "pick up" as the effects of good monsoon rainfall kick in later in the year. The annual monsoon accounts for 70% of India's rainfall and irrigates more than half its farmland.

Singh's government had earlier given the nod for infrastructure projects worth several billions of dollars in a bid to boost investment in the country. The country's central bank announced it would pump more than a billion dollars' worth of stimulus into its banking system to increase the availability of credit to key sectors.

The Indian economy grew at its slowest pace in four years in the April-June quarter. Growth dropped to 4.4% as against 4.8% during the January-March quarter.

Economic growth hit a decade low of 5% in the 2013 financial year.