For the month of September, growth in India's manufacturing sector remained weak. The Nikkei Manufacturing Purchasing Managers' Index (PMI), compiled by IHS Markit, was 51.4 in September, unchanged from August.
The growth rate in these months have been the slowest since May 2018, however, it has remained above the 50-mark which separates growth from contraction for over two years.
The survey showed that overall demand rose marginally in September, hurt by almost no growth in exports, and firms barely increasing hiring. These signs are worrying for the government and policymakers as the economy has been showing no signs of picking up pace.
In the last month, factories also cut back on purchases of raw materials, indicating they do not expect a marked pick up in demand.
For the first quarter of the financial year 2019-20, India's economy expanded at an annual rate of 5 percent, the slowest in more than six years. The government has announced several measures in the last two months to try and revive growth.
"In light of the weak results for economic growth and muted inflationary pressures signalled by the PMI data, we expect to see further monetary easing in the months ahead," Pollyanna De Lima, principal economist at IHS Markit, said in a release.
RBI's monetary policy committee meeting is scheduled for 4 October, where the central bank is widely expected to cut rates, adding to the 110 basis points of cuts already delivered this year.