India Urges S&P To Upgrade Its Sovereign Rating
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Indian officials on Thursday met with analysts from ratings agency Standard & Poor’s to argue for an upgrade in its sovereign rating, citing recent steps by the government to put the economy back on track, according to a report by Reuters.
Indian officials on Thursday met with analysts from ratings agency Standard & Poor’s to argue for an upgrade in its sovereign rating, citing recent steps by the government to put the economy back on track, according to a report by Reuters.
The meeting came after S&P and its rival Fitch last year cut their outlook on India to negative, warning that the economy was at risk of a downturn amid worsening public finances, a slowing economy and persistent political gridlock.
But Economic Affairs Secretary Arvind Mayaram said that there was no longer a case for a rating downgrade, as the government had already taken “strong and hard decision”, such as reducing subsidies on petroleum products, to minimise risks.
“This country has shown its determination to put economy back on track. We believe it will happen,” Mayaram said, referring to an upgrade.
[quote]”I think there is a case for an upgrade because we have taken the kind of decisions that most of countries in the world have not been able to take,” he added.[/quote]Related: India Face “One-in-Three” Risk Of Downgrade To Junk Status: S&P
Related: India Suffers Largest Growth Forecast Cut Among Emerging Markets
Related: The Broken BRIC – Why India’s Economy Is Underperforming: Raghuram Rajan
According to the latest Indian Prime Minister’s Economic Advisory Council’s (PMEAC’s) projections, the nation’s GDP is set to grow by 6.4 percent in 2013-14, after a decade-low rate of 5 percent last year.
In March, Prime Minister Manmohan Singh also predicted that economy would return to a high growth trajectory path within the next 2-3 years, admitting that the government would still have to take further steps to promote inclusive growth.
“It is certainly true that in the last two years there has been a slowdown in the economy and it has been reflected in the GDP. In the Economic Survey of 2012-13 and the Finance Minister’s budget speech, we have explained at length the factors that are responsible for the slowdown.
[quote]”The country needs a growth rate of 8-9 percent if we are to get rid of poverty and unemployment. We will come out of current economic situation and bounce back to seven to eight percent growth in two to three years,” he said.[/quote]Related: Indian Economy To Return To High Growth In 2-3 Years: PM
Related: The Broken BRIC: India’s Economic Challenges
According to Reuters, the Indian government also met with Fitch analysts earlier this month to discuss a ratings upgrade. Both Fitch and S&P presently rate India at BBB- with a negative outlook, the lowest investment grade among the BRICS.
