Fitch likely to down­grade In­dia’s rat­ing

The Pak Banker - - COMPANIES/BOSS -

De­spite In­dian Fi­nance Min­is­ter P Chi­dambaram’s prom­ise to put In­dia’s fis­cal house in or­der in his lat­est bud­get plan, rat­ings agency Fitch said the coun­try’s credit rat­ing - which is tee­ter­ing on the brink of ‘junk’ sta­tus - will more than likely be down­graded, cit­ing weak­ness in Asia’s third largest econ­omy’s macro out­look.

“The re­al­ity is it [credit rat­ing] is on neg­a­tive out­look - so that bias sug­gests it’s more than likely we will down­grade - that says it all,” Art Woo, di­rec­tor, sov­er­eign rat­ings at Fitch Rat­ings told CNBC Asia’s “The Call” on Fri­day - a day af­ter Chi­dambaram pre­sented a prag­matic bud­get in which he an­nounced a fis­cal deficit tar­get of 4.8 per­cent for the new fis­cal year be­gin­ning April 1.

“If you look at the to­tal­ity of mea­sures that have been an­nounced over the last six months, there have been some pos­i­tive el­e­ments...but ob­vi­ously the macro eco­nomic back­drop has weak­ened,” he added.

Slow­ing growth, which came in at 4.5 per­cent in the De­cem­ber quar­ter, cou­pled with high in­fla­tion, hov­er­ing around 7 per­cent and a bal­loon­ing cur­rent ac­count deficit.

Newspapers in English

Newspapers from Pakistan

© PressReader. All rights reserved.