Brokerage house CLSA had cut its forecast for Indian GDP growth to 5.5% for FY 2013, from its earlier projection of 6%.

Earlier, Citi also cut India's GDP forecast to 5.4% from 6.2% for FY 2013.

India's Central Bank, the RBI began the GDP growth estimates cut in its monetary policy review, pruning GDP growth forecast for the current financial year from 7.3% to 6.5% and hiked the inflation forecast from 6.5% to 7%.

On Tuesday, CRISIL Research cut India's real GDP growth forecast for 2012-13 to 5.5 per cent from its earlier forecast of 6.5 per cent. The average WPI inflation forecast has been raised to 8.0 per cent from 7.0 per cent released earlier.

"The downward revision in India's growth forecast factors in the adverse impact of rainfall deficiency (an expected deficiency of 15 per cent for June-September 2012, as per Indian Meteorological Department) and worsening of the Euro zone growth outlook (a revision in 2012 growth forecast to -0.6 per cent by Standard & Poor's relative to the earlier forecast of ‘zero' per cent)," Crisil has stated.

If the monsoon scenario gets worst, one can expect further downgrades from rating agencies.

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