NEW DELHI: The government on Friday lowered its growth forecast for the fiscal year ending in March 2016 to 7-7.5 percent from 8.1-8.5 percent estimated in February.
The revision came after Asia's third-largest economy grew 7.2 percent in the first half of the 2015/16 fiscal year.
In its mid-year economic review presented in parliament, the finance ministry said though the economy has made considerable progress, yet challenges remain.
"India to stick to 2015-16 fiscal deficit target"
The government will stick to its budgeted fiscal deficit target of 3.9 percent of GDP for the fiscal year ending in March 2016, the finance ministry said in a report on Friday.
The government hopes to hit the target without cutting expenditure or deferring tax refunds, Finance Minister Arun Jaitley had said earlier this week.
In the budget in February, Jaitley had pledged to narrow the deficit to 3.9 percent of GDP in this fiscal year from 4.0 percent in 2014/15.