Gross domestic product in the three months that ended in March likely grew 7.3 per cent from a year earlier, a Reuters' poll of economists found, outpacing China for the second straight quarter.
But New Delhi, worried that companies are not investing enough and that a period of low inflation may be short-lived, is nudging Reserve Bank of India Governor Raghuram Rajan to lower lending rates from 7.5 per cent at a policy meeting on Tuesday.
The government's position reflects nagging doubts that a new way of measuring GDP introduced earlier this year, which boosted growth by several points, may have distorted the macroeconomic view.
For example, economists say weak corporate earnings and five months of falling merchandise exports - which make up about 16 per cent of the nearly $2 trillion economy -- are not reflected in the robust GDP figures based on the new methodology.
"We are not experiencing a high level of growth if you look at a variety of high-frequency indicators," said Rahul Bajoria, an economist at Barclays.
Bajaria said he expected a 25 basis-point rate cut at the June 2 meeting and said the RBI had a short window to help encourage growth.
"In the second half, inflation may pick up," he said.
For the 2014/15 fiscal year growth is expected at 7.4 percent, up from 6.9 percent in 2013/14, using the new series.
On Wednesday, Dr Rajan met Finance Minister Arun Jaitley, who has publicly favoured a rate cut, citing falling inflation.
The RBI has already cut rates twice this year after inflation fell within its comfort zone, but it left them unchanged in April.
"We expect RBI should cut interest rates by 25 basis points. After that they will probably wait for the monsoon data before deciding whether there is more room for rate cut," Mr Bajoria said.
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