New Delhi: Industry body Assocham has revised slightly downwards its forecast on the GDP to 7.1% for the current fiscal on account of slowdown in exports and industrial production.

According to the Assocham Business Barometer (ABB) survey of 250 CEOs, about 80% projected GDP growth for 2008-09 at 7.1% from the earlier 7.6%, with strong waves of negative economic sentiment.

A 2% decline in the growth rate for 2008-09 from the previous year can trigger a further slump in the economic activity that could pose serious threats of a slowdown in the forthcoming fiscal, it said.

“The outlook for the fiscal 2009-10 is seen as even worse with the growth projections made at 6.5% as the effect of job cuts, negative production growth rate and stagnant US and EU economies would be felt on the Indian economy,” Assocham Secretary General D S Rawat said.

The survey added that on account of a slowdown in agricultural growth in the first half of the fiscal at 2.9%, compared with 4.5% in the same period last year, the growth has been revised at 3.9%.

Over 80% of CEOs said manufacturing sector, which has witnessed a negative growth of 1.2% in October, would take double hit from the rapid slackening of domestic demand and heavy shrinkage in new export orders.

Services sector which recorded an average growth rate of 10.7% in last three years is expected to deteriorate to below 9% growth rate mark, it said.

However, about 64% of the respondents said the interest rate cuts by the RBI will help in lifting the GDP growth.