India's September collection of factory gate duties contracted 8.7 per cent to 114.3 billion rupees ($231.98 bn), S D Majumder, Chairman of the Central Board of Excise and Customs told media, an indication that slowing manufacturing and industrial growth has affected revenue growth in the economy.

Indirect tax receipts in September was up nearly 6 per cent to 324.4 billion rupees but Majumder expected manufacturing to pick up in October. He also said the board expects to meet the indirect tax target for the current fiscal year.

Indirect taxes include taxes such as customs duties, factory gate duties and service tax.

India has budgeted indirect tax collections of about 3.98 trillion rupees for the current fiscal but the sluggish growth in indirect tax collections has raised questions about the government's ability to meet the FY12 fiscal deficit target of 4.6 per cent of the gross domestic product.