- Relief from S&P to the central government, which is facing all-round criticism due to the sluggish economy
- S&P maintains India’s sovereign rating at ‘BBB’ with ‘stable outlook’
- The agency says that despite the decline, the economy will continue to achieve impressive long-term growth
- In the second quarter of the current financial year. Also, the economic growth rate has come down to 4.5 percent, its six-year low
The S&P stance has brought relief to the government amid a slowdown in the economy by some rating agencies downgrading ratings. The global rating agency S&P has maintained India’s sovereign rating at ‘BBB’ with a ‘stable outlook’. Economic Affairs Secretary Atanu Chakraborty gave this information on Tuesday.
The S&P brought relief to the government
This S&P rating is significant considering that just a few weeks ago, another global rating agency Moody’s Investor Service had changed India’s rating outlook from ‘stable’ to ‘negative’.
The economy will continue to achieve long term growth
Chakraborty tweeted, “S&P has maintained India’s sovereign rating at ‘BBB’ with a stable outlook. The agency says that despite the recent decline, the Indian economy will continue to achieve impressive long-term growth. The BBB rating reflects an entity’s adequate ability to meet its financial commitments. However, adverse economic conditions or changing circumstances may weaken its ability to meet its financial commitments.
GDP growth rate at six and a half year low
The latest S&P rating comes at a time when the opposition is constantly attacking the government over the declining economy and alleging that the government is not doing enough to stop the decline in economic growth. It is noteworthy that in the second quarter of the current financial year. Also, the economic growth rate has come down to 4.5 percent, which is its six-year low.
Slowness in economy cyclical
The Finance Ministry, citing a brief publication released on India by S&P, said, “Despite the recent decline, the Indian economy will continue to achieve impressive growth rates in the long run.” It is believed that the current economic slowdown is more cyclical than structural. ‘
Better performance estimates
The S&P forecasts that the Indian economy will outperform its counterparts and the growth rate will remain strong over the next two years. The agency has maintained a stable scenario in the case of India on the basis that the economic growth rate will remain strong. However, during the next two years and India’s external situation will also be better. With this, the fiscal deficit will remain high, but broadly it will remain within the scope of projections.
