The survey conducted by the U.S.-based Pew Research Center found that just 38 percent of respondents are satisfied with India's direction, down from 51 percent a year ago. Pew said Monday that survey finding marked one of the greatest declines in satisfaction among the 17 nations surveyed in 2011 and 2012.
Pew says the falling satisfaction among Indians polled is coupled with widespread concern about the economy, with roughly eight in 10 Indians citing unemployment and rising prices as "very big" problems.
Only about 49 percent of survey respondents say India's economy is in good shape, a seven percent drop from last year.
India's economic growth slowed to 5.3 percent in the first quarter of 2012 - the lowest point in nine years.
In its report, Pew says "the economic euphoria in India over the last few years, inspired by the country's seemingly inevitable march toward double-digit growth, has soured and is now faring worse than in China and Brazil."
Pew says the face-to-face survey of more than 4,000 people in India was conducted between March and April of this year.
The poll found that wealthier Indians are more optimistic about the economy's future and are more likely than lower-income Indians (by 13 points) to say they are better off than they were five years ago.
When questioned about India's longtime rival, just 13 percent of those surveyed say they have a positive view of Pakistan. But seven in 10 Indians think it is important to improve relations, including through resolution of the Kashmir dispute (77 percent), increased trade (64 percent) and further negotiations (58 percent).
Only a third of urban Indians surveyed have a favorable view of China, and half think China's growing economy is bad for India.
Pew found that a majority of urban Indians - about 58 percent - have a favorable view of the United States. Seven in 10 city-dwellers say they were following the U.S. presidential election closely and want President Barack Obama to be re-elected.