Fluctuating clock speeds (Intel HD 4000)

My laptop is having the following specs

Intel Core i3 3217u

4GB DDR3 1600 RAM

Intel HD 4000

Windows 8.1

Its running the newest Windows 8.1 x64 driver from Intel's site.

The problem is , whenever I game, the GPU clock fluctuates a lot.

For eg, the game is running smooth, at say 30fps. The GPU clock is stable at 1050MHz (monitoring using GPU-Z). Suddenly for 4-5 secs, fps drops to 8-9 fps. Then it goes back up. And this goes on and on.

GPU-Z logs say that in the time when the fps drops, the GPU is sitting at 350MHz, while GPU load is still 95+ %.

Why is the GPU dipping so low frequently ? Its hampering the performance a lot, in an otherwise capable system. My power settings are all set to give Maximum Performance option in Intel HD Graphics, so thats not it.

EDIT: Its probably not throttling due to temperature, as the GPU is mostly around 65-70C.